Austerity Measures, U.S. Style, Exposed

“We have abandoned the common good. We have been stripped of our rights and voice. Corporations write our laws and determine how we structure our society. We have all become victims. There are no politicians or institutions, no political parties or courts, that are independent enough or strong enough to resist the corporate onslaught. Greater and greater numbers of human beings will be consumed. The poor, the vulnerable, the undocumented, the weak, the elderly, the sick, the children will go first. And those of us watching helplessly outside the gates will go next.” -Chris Hedges. When you understand the key purposes for Austerity Measures, referred to euphemistically in the U.S. as “Sequestration”,  “Deficit Reduction”, “Entitlement Reform”, “Fiscal Responsibility” and “Increasing payroll tax “, are to “(1) shift the burden of paying for crisis and bailouts (from the creditors/creators of the crisis), onto the total population, (2) reduce the economic footprint (privatization/monetization) of the government, and (3) reduce creditors(/crisis creators)‘ concerns about rising US debt levels.” Richard Wolff, you begin to see that this urgent and well reported “debate” over Sequestration is just the latest installment of U.S. Government Kabuki Theater.  The White House and Congress twice agreed to go into sequestration in 2011.  Both sides are not talking, they are preparing for the list of cuts and positioning for the public relations disaster afterwards. There is a high probability that these cuts will go into effect. Even in the face of mountains of evidence from past and present day Europe that austerity does not enable economic growth, but does increase the potential for violence and social unrest. Austerity functions primarily as means by which the international banking cartels and the transnational corporate network ensures attractive returns on their investments/looting/fraud/market manipulation. It enriches those in the 1% at the expense of the poor, elderly, & disenfranchised. It fails to address one essential factor that accompanies the current depression. Inequality. Inequality and wealth concentration has equaled and exceeded levels reached in the last Great Depression. Raising the minimum wage a paltry $1.75 will have no significant effect on inequality or quality of life  among the nearly 1 in 2 Americans living in or near poverty.  There is no addressing of the hidden tax of  rising food prices created by the creditors/creators of the crisis’ unregulated and dangerous speculation on commodities markets. Austerity measures will actually make life significantly worse for the poor and less fortunate, creating more sick people, less housing, more hunger, less safety. This is the first in a series of  points of danger for our economy, enshrined in a series of laws which are the result of every accommodation the president has made over the last year and a half. Over the next 10 weeks, we will lurch from crisis to crisis, and the economic decision-making apparatus will remain in chaos through his deference. The “least” among us are being sacrificed. Who will be next?”

By Richard D. Wolff @ Truthout:

Austerity policies include various combinations primarily of government spending cuts and secondarily of general tax increases. Republicans and Democrats have endorsed austerity since 2010. Austerity was the result of their deal on taxes last December 31: increasing the payroll tax on wages and salaries from 4.2 to 6.2 percent. Austerity is what they are negotiating now in regard to federal spending cuts.

After 2010, with “recovery” underway for them following bailouts for them, large private capitalist interests focused on three key interests. First, they wanted to ensure that the bailouts’ costs were not paid for by higher taxes on corporations and the rich. By stressing government spending cuts and broad-based tax increases, austerity policies serve that interest. Second, they worried about crisis-heightened government economic intervention and power and wanted to reduce them back to pre-crisis levels. Austerity’s focus on reduced government spending lessens the government’s economic footprint. Third, because big banks and other large capitalists are among the major creditors of the US government, they wanted signs that their crisis-increased holdings of US debt were safe investments for them. Austerity policies provide just those signs, as we shall show.

Austerity in the US, unlike in Europe, is renamed and packaged for the public as “deficit reduction programs” or “fiscal responsibility.” Distractions such as “fiscal cliffs” and “debt ceilings” focus public attention on mere secondary details of austerity. Politicians, media and academics use such distractions to wrangle over whose taxes will go up how much and which recipients of government spending will suffer what size cuts. They do not debate austerity itself; that is, they do not debate very idea of raising mass taxes and cutting spending in a deep and long economic downturn. They do not explore the interests served and undermined by any austerity policy. So we will.

Austerity promoters repeatedly insist that the dominant economic problem today is government budget deficits. They ignore why those deficits occurred (the crisis plus bailouts). They demand that both parties and the media endorse austerity because cuts in government spending and increased taxes will reduce deficits. They hype austerity as the solution all must embrace. Otherwise, they fear, a different and dangerous logic might win popular support. In that logic, since capitalism regularly causes crises that cause deficits, another solution for deficits would be changing from capitalism to another economic system not beset by regular crises.

Austerity policies, we are told, will reduce deficits and thereby meet what “the credit market” demands. In other words, those who have lent to the US government (by buying its debt securities) want guarantees of interest and repayment. By cutting government spending and raising taxes, austerity policies redirect government funds to the government’s creditors, thereby reassuring them.

Distracting references to an anonymous “market” avoid identifying the government’s creditors. However, major creditors holding US public debt are easy to list: large banks, insurance companies, large corporations, wealthy individuals and central banks around the world. Austerity justified as satisfying “the market” in fact serves those US creditors first and foremost.

Austerity is thus the policy preferred by the private capitalist interests that (1) brought on the crisis, (2) secured the government bailouts almost exclusively for themselves, and (3) are that government’s chief creditors. Led by major banks, those interests now threaten the government (that just bailed them out) with higher interest rates or no more credit unless it imposes higher taxes (mostly on others) and reduced spending (mostly on others) to lower its deficits. Distracting struggles over “fiscal cliffs” and “debt ceilings” serve nicely to disguise the reality that both parties’ austerity policies represent and illustrate gross government subservience to large capitalists.

Austerity, US style, has its Keynesian economist critics. They point out that the United States has been able to borrow trillions at historically low interest rates through this crisis. US deficits have not worried “the market” at all. Policies should therefore not be driven by deficits. Keynesians insist that raising mass taxes and cutting spending during an economic downturn will reduce outlays on goods and services by taxpayers and government, thereby worsening unemployment. They thus ridicule the argument that austerity, by cutting deficits, will stimulate investment by capitalists.

For Keynesians, austerity is thus unneeded and counterproductive. They prefer to exit the crisis by more stimulus (lower taxes and higher government spending) funded by higher deficits. The resulting economic growth, they believe, will automatically lower government budgetary imbalance. The government can then later, if and when needed, impose tax increases and reduce government spending to shrink deficits. In a growing economy, austerity policies avoid the devastating effects they have in depressed economies (as shown by the recent histories of Greece, Portugal, the UK and others).

Setting aside the question of the validity of Keynesian arguments, they miss key purposes of austerity policies. Those policies do not primarily seek to overcome crisis or resume economic growth. Rather, as argued above, they aim chiefly to (1) shift the burden of paying for crisis and bailouts onto the total population, (2) reduce the economic footprint of the government, and (3) reduce creditors’ concerns about rising US debt levels. If austerity policies achieve these objectives, their failure to end the crisis quickly is a price that corporations and the rich are more than happy to pay (or rather, have others pay).

That Republicans and Democrats concur on austerity and differ only on its secondary details testifies to what they share. Both depend financially on capitalist corporations and their top executives. Both serve and never question capitalism. For all the victims of capitalism today – the unemployed, those foreclosed out of their homes, those with reduced job benefits and job security, students with unsustainable schooling debts and poor job prospects, millions without medical insurance, and so on – supporting those parties perpetuates their victimization.

 

Youth In Revolt: The Plague Of State-Sponsored Violence

Oldspeak: “The predominance of violence in all aspects of social life suggests that young people and others marginalized by class, race and ethnicity have been abandoned as American society’s claim on democracy gives way to the forces of militarism, market fundamentalism and state terrorism.” In a state where children are disposable, subjected to violence and threats of violence in most every aspect of their lives, programmed from birth to be nothing more than finely tuned profit generating”happiness machines”. Where 1o children a day are killed by guns (more than police killed in the line of duty) can we really be surprised by the senseless violence perpetrated on children like Trayvon Martin?

By Henry A. Giroux @ Truthout:

Young people are demonstrating all over the world against a variety of issues ranging from economic injustice and massive inequality to drastic cuts in education and public services. At the moment, these demonstrations are being met with state-sanctioned violence and insults in the mainstream media rather than with informed dialogue, critical engagement and reformed policies. In the United States, the state monopoly on the use of violence has intensified since the 1980s and, in the process, has been increasingly directed against young people, poor minorities, immigrants and increasingly women. As the welfare state is hollowed out, a culture of compassion is replaced by a culture of violence, cruelty and disposability. Collective insurance policies and social protections have given way to the forces of economic deregulation, the transformation of the welfare state into punitive workfare programs, the privatization of public goods and an appeal to individual responsibility as a substitute for civic responsibility. Under the notion that unregulated market-driven values and relations should shape every domain of human life, the business model of governance has eviscerated any viable notion of social responsibility while furthering the criminalization of social problems and cut backs in basic social services, especially for the poor, young people and the elderly.(1) Within the existing neoliberal historical conjuncture, there is a merging of violence and governance and the systemic disinvestment in and breakdown of institutions and public spheres, which have provided the minimal conditions for democracy.

As young people make diverse claims on the promise of a radical democracy, articulating what a fair and just world might be, they are increasingly met with forms of physical, ideological and structural violence. According to OccupyArrests.com, “There have been at least 6705 arrests in over 112 different cities as of March 6, 2012.”(2) Abandoned by the existing political system, young people in Oakland, California; New York City; and numerous other cities are placing their bodies on the line, protesting peacefully while trying to produce a new language, politics, long-term institutions and “community that manifests the values of equality and mutual respect that they see missing in a world that is structured by neoliberal principles.”(3) This movement is not simply about reclaiming space, but also about producing new ideas, generating a new conversation and introducing a new political language. Rejecting the notion that democracy and markets are the same, young people are calling for an end to the corporate control of the commanding institutions of politics and culture, poverty, the suppression of dissent and the permanent war state. Richard Lichtman is right in insisting that this movement should be praised for its embrace of communal democracy as well as an emerging set of shared concerns, principles and values articulated “by a demand for equality, or, at the very least, for a significant lessening of the horrid extent of inequality; for a working democracy; for the elimination of the moneyed foundation of politics; for the abolition of political domination by a dehumanized plutocracy; for the replacement of ubiquitous commodification by the reciprocal recognition of humanity in the actions of its agents.”(4) As Arundhati Roy points out, what connects the protests in the United States to resistance movements all over the globe is that young people are realizing that “they know that their being excluded from the obscene amassing of wealth of US corporations is part of the same system of the exclusion and war that is being waged by these corporations in places like India, Africa and the Middle East.”(5) Of course, Lichtman, Roy, and others believe that this is just the beginning of a movement and that much needs to be done, as Staughton Lynd argues, to build new strategies, a vast network of new institutions and public spheres, a community of trust and political organization that invites poor people into its ranks.(6)

All of these issues are important, but what must be addressed in the most immediate sense is the threat the emerging police state in the United States poses not to just the young protesters occupying a number of American cities, but also the threat it poses to democracy itself as a result of the merging of a war-like mentality and neoliberal mode of discipline and education in which it becomes difficult to reclaim the language of obligation, social responsibility and civic engagement. Unless the actions of young protesters, however diverse they may be, is understood within the language of a robust notion of the social, civic courage and the imperatives of a vital democracy, it will be difficult for the American public to resist state violence and the framing of protests, dissent and civic responsibility as un-American or, at worst, a species of criminal behavior.

While there is considerable coverage in the progressive media given to the violence being waged against the Occupy movement protesters, I want to build on these analyses by arguing that it is important to situate such violence within a broader set of categories that enables a critical understanding of not only the underlying social, economic and political forces at work in such assaults, but also allows us to reflect critically on the distinctiveness of the current historical period in which they are taking place. For example, it is difficult to address such state-sponsored violence against young people without analyzing the devolution of the social state and the corresponding rise of the warfare and punishing state. The notion of historical conjuncture is important here because it provides both an opening into the forces shaping a particular historical moment and it allows for a merging of theory and strategy. That is, it helps us to address theoretically how youth protests are largely related to a historically specific neoliberal project that promotes vast inequalities in income and wealth, creates the student loan debt bomb, eliminates much needed social programs, eviscerates the social wage and privileges profits and commodities over people. Within the United States, the often violent response to nonviolent forms of youth protests must also be analyzed within the framework of a mammoth military-industrial state and its commitment to war and the militarization of the entire society. As Tony Judt put it, “The United States is becoming not just a militarized state but a military society: a country where armed power is the measure of national greatness and war, or planning is the exemplary (and only) common project.”(7) The merging of the military-industrial complex and unbridled corporate power points to the need for strategies that address what is specific about the current warfare state and the neoliberal project and how different interests, modes of power, social relations, public pedagogies and economic configurations come together to shape its politics. Such a conjuncture is invaluable politically in that it provides a theoretical opening for making the practices of the warfare state and the neoliberal revolution visible in order “to give the resistance to its onward march, content, focus and a cutting edge.”(8) It also points to the conceptual power of making clear that history remains an open horizon that cannot be dismissed through appeals to the end of history or end of ideology.(9) It is precisely through the indeterminate nature of history that resistance becomes possible and politics refuses any guarantees and remains open. Following Stuart Hall, I want to argue that the current historical moment or what he calls the “long march of the Neoliberal Revolution,”(10) has to be understood in terms of the growing forms of violence that it deploys and reinforces. Such anti-democratic pressures and their relationship to the rising protests of young people in the United States and abroad are evident in the crisis that has emerged through the merging of governance and violence, the growth of the punishing state and the persistent development of what has been described by Alex Honneth as “a failed sociality.”(11)

The United States has become addicted to violence and this dependency is fuelled increasingly by its willingness to wage war at home and abroad. War in this instance is not merely the outgrowth of polices designed to protect the security and well-being of the United States. It is also, as C. Wright Mills pointed out, part of a “military metaphysics”(12) – a complex of forces that includes corporations, defense industries, politicians, financial institutions and universities. War provides jobs, profits, political payoffs, research funds and forms of political and economic power that reach into every aspect of society. War is also one of the nation’s most honored virtues, and its militaristic values now bear down on almost every aspect of American life.(13) As war becomes a mode of sovereignty and rule, it erodes the distinction between war and peace. Increasingly fed by a moral and political hysteria, warlike values produce and endorse shared fears as the primary register of social relations.

Shared fears and the media hysteria that feed them produce more than a culture of fear. Such hysteria also feeds the growing militarization of the police, who increasingly use their high-tech scanners, surveillance cameras and toxic chemicals on anyone who engages in peaceful protests against the warfare and corporate state. Images abound in the mainstream media of such abuses. There is the now famous image of an 84-year-old woman looking straight into a camera, her face drenched in a liquid spray used by the police after attending a protest rally. There is the image of a woman, who is two months pregnant, being carried to safety after being pepper sprayed by the police. There are the all-too-familiar images of young people being dragged by their hair across a street to a waiting police van.(14) In some cases, protesters have been seriously hurt as in the case of Scott Olsen, an Iraqi war veteran, who was critically injured in a protest in Oakland in October 2011. Too much of this violence is reminiscent of the violence used against civil rights demonstrators by the forces of Jim Crow in the fifties and sixties.(15)

The war on terror has become a war on democracy as baton-wielding cops are now being supplied with the latest military equipment imported straight from the battlefields of Iraq and Afghanistan. Military technologies once used exclusively on the battlefield are now being supplied to police departments across the nation. Drones; machine-gun-equipped armored trucks; SWAT vehicles; “digital communications equipment and Kevlar helmets, like those used by soldiers used in foreign wars.”(16) The domestic war against “terrorists” (code for young protesters) provides new opportunities for major defense contractors and corporations who “are becoming more a part of our domestic lives.”(17) As Glenn Greenwald points out, the United States since 9/11 “has aggressively para-militarized the nation’s domestic police forces by lavishing them with countless military-style weapons and other war-like technologies, training them in war-zone military tactics and generally imposing a war mentality on them. Arming domestic police forces with para-military weaponry will ensure their systematic use even in the absence of a Terrorist attack on U.S. soil; they will simply find other, increasingly permissive uses for those weapons.”(18) Of course, the new domestic para-military forces will also undermine free speech and dissent with the threat of force while simultaneously threatening core civil liberties, rights and civic responsibilities. Given that “by age 23, almost a third of Americans are arrested for a crime,” it becomes clear that in the new militarized state the view of young people as predators, a threat to corporate governance and disposable will increase as will the growth of a punishment state that acts with impunity.(19)

No longer restricted to a particular military ideology, the celebration of war-like values has become normalized through the militarization of the entire society. As Michael Geyer points out, militarization in this sense is defined as “the contradictory and tense social process in which civil society organizes itself for the production of violence.”(20) The conceptual merging of war and violence is evident in the way in which the language of war saturates the ways in which policy makers talk about waging war on drugs, poverty and the underclass. There is more at work here than the prevalence of armed knowledge and a militarized discourse; there is also the emergence of a militarized society in which “the range of acceptable opinion inevitably shrinks.”(21) But the prevailing move in American society to a permanent war status does more than promote a set of unifying symbols that embrace a survival-of-the-fittest ethic, promoting conformity over dissent, the strong over the weak and fear over responsibility; it also gives rise to a “failed sociality” in which violence becomes the most important element of power and mediating force in shaping social relationships.

As a mode of public pedagogy, a state of permanent war needs willing subjects to abide by its values, ideology and narratives of fear and violence. Such legitimation is largely provided through a market-driven culture addicted to the production consumerism, militarism and organized violence, largely circulated through various registers of popular culture that extend from high fashion and Hollywood movies to the creation of violent video games and music concerts sponsored by the Pentagon. The market-driven spectacle of war demands a culture of conformity, quiet intellectuals and a largely passive republic of consumers. But it also needs subjects who find intense pleasure in the spectacle of violence.

As the pleasure principle is unconstrained by a moral compass based on a respect for others, it is increasingly shaped by the need for intense excitement and a never-ending flood of heightened sensations. What has led to this immunity and insensitivity to cruelty and prurient images of violence? Part of this process is due to the fact that the American public is bombarded by an unprecedented “huge volume of exposure to … images of human suffering.”(22) As Zygmunt Bauman argues, there are social costs that come with this immersion of a culture of staged violence. One consequence is that “the sheer numbers and monotony of images may have a ‘wearing off’ impact [and] to stave off the ‘viewing fatigue,’ they must be increasingly gory, shocking and otherwise ‘inventive’ to arouse any sentiments at all or indeed draw attention. The level of ‘familiar’ violence, below which the cruelty of cruel acts escapes attention, is constantly rising.”(23)

Hyper-violence and spectacular representations of cruelty disrupt and block our ability to respond politically and ethically to the violence as it is actually happening on the ground. In this instance, unfamiliar violence such as extreme images of torture and death become banally familiar, while familiar violence that occurs daily is barely recognized relegated to the realm of the unnoticed and unnoticeable. How else to explain the public indifference to the violence waged by the state against nonviolent youthful protesters, who are rebelling against a society in which they have been excluded from any claim on hope, prosperity and democracy. As an increasing volume of violence is pumped into the culture, yesterday’s spine-chilling and nerve-wrenching violence loses its shock value. As the need for more intense images of violence accumulates, the moral indifference and desensitization to violence grows while matters of cruelty and suffering are offered up as fodder for sports, entertainment, news media, and other outlets for seeking pleasure.

Marked by a virulent notion of hardness and aggressive masculinity, a culture of violence has become commonplace in a society in which pain, humiliation and abuse are condensed into digestible spectacles endlessly circulated through extreme sports, reality TV, video games, YouTube postings and proliferating forms of the new and old media. But the ideology of hardness and the economy of pleasure it justifies are also present in the material relations of power that have intensified since the Reagan presidency, when a shift in government policies first took place, and set the stage for the emergence of unchecked torture and state violence under the Bush-Cheney regime. Conservative and liberal politicians alike now spend millions waging wars around the globe, funding the largest military state in the world, providing huge tax benefits to the ultra-rich and major corporations and all the while draining public coffers, increasing the scale of human poverty and misery and eliminating all viable public spheres – whether they be the social state, public schools, public transportation, or any other aspect of a formative culture that addresses the needs of the common good. State violence, particularly the use of torture, abductions and targeted assassinations, are now justified as part of a state of exception that has become normalized. A “political culture of hyper punitiveness”(24) has become normalized and accelerates throughout the social order like a highly charged electric current. Democracy no longer leaves open the importance of an experience of the common good. As a mode of “failed sociality,” the current version of market fundamentalism has turned the principles of democracy against itself, deforming both the language of freedom and justice that made equality a viable idea and political goal. State violence operating under the guise of personal safety and security, while parading species of democracy, cancels out democracy “as the incommensurable sharing of existence that makes the political possible.”(25) Symptoms of ethical, political and economic impoverishment are all around us.

Meanwhile, exaggerated violence is accelerated in the larger society and now rules screen culture. The public pedagogy of entertainment includes extreme images of violence, human suffering and torture splashed across giant movie screens, some in 3D, offering viewers every imaginable portrayal of violent acts, each more shocking and brutal than the last. The growing taste for violence can be seen in the increasing modeling of public schools after prisons, the criminalization of behaviors such as homelessness that once were the object of social protections. A symptomatic example of the way in which violence has saturated everyday life can be seen in the growing acceptance of criminalizing the behavior of young people in public schools. Behaviors that were normally handled by teachers, guidance counselors and school administrators are now dealt with by the police and the criminal justice system. The consequences have been disastrous for young people. Not only do schools resemble the culture of prisons, but young children are being arrested and subjected to court appearances for behaviors that can only be termed as trivial. How else to explain the case of the five-year-old girl in Florida who was put in handcuffs and taken to the local jail because she had a temper tantrum; or the case of Alexa Gonzales in New York who was arrested for doodling on her desk. Even worse, a 13-year-old boy in a Maryland school was arrested for refusing to say the pledge of allegiance. There is more at work than stupidity and a flight from responsibility on the part of educators, parents and politicians who maintain these laws; there is also the growing sentiment that young people constitute a threat to adults and that the only way to deal with them is to subject them to mind-crushing punishment. Students being miseducated, criminalized and arrested through a form of penal pedagogy in prison-type schools provide a grim reminder of the degree to which the ethos of containment and punishment now creeps into spheres of everyday life that were largely immune in the past from this type of state violence. The governing through crime ethic also reminds us that we live in an era that breaks young people, corrupts the notion of justice and saturates the minute details of everyday life with the threat, if not reality, of violence. This mediaeval type of punishment inflicts pain on the psyche and the body of young people as part of a public spectacle. Even more disturbing is how the legacy of slavery informs this practice given that “Arrests and police interactions … disproportionately affect low-income schools with large African-American and Latino populations,”(26) paving the way for them to move almost effortlessly through the school-to-prison pipeline. Surely, the next step will be a reality TV franchise in which millions tune in to watch young kids being handcuffed, arrested, tried in the courts and sent to juvenile detention centers. This is not merely barbarism parading as reform – it is also a blatant indicator of the degree to which sadism and the infatuation with violence have become normalized in a society that seems to take delight in dehumanizing itself.

As the social is devalued along with rationality, ethics and any vestige of democracy, spectacles of war, violence and brutality now merge into forms of collective pleasure that constitute an important and new symbiosis among visual pleasure, violence and suffering. The control society is now the ultimate form of entertainment as the pain of others, especially those considered disposable and powerless, has become the subject not of compassion, but of ridicule and amusement in America. High-octane violence and human suffering are now considered another form of entertainment designed to raise the collective pleasure quotient. Reveling in the suffering of others should no longer be reduced to a matter of individual pathology, but now registers a larger economy of pleasure across the broader culture and social landscape. My emphasis here is on the sadistic impulse and how it merges spectacles of violence and brutality with forms of collective pleasure. No society can make a claim to being a democracy as long as it defines itself through shared fears rather than shared responsibilities. Widespread violence now functions as part of an anti-immune system that turns the economy of genuine pleasure into a mode of sadism that creates the foundation for sapping democracy of any political substance and moral vitality. The prevalence of institutionalized violence in American society and other parts of the world suggests the need for a new conversation and politics that addresses what a just and fair world looks like. The predominance of violence in all aspects of social life suggests that young people and others marginalized by class, race and ethnicity have been abandoned as American society’s claim on democracy gives way to the forces of militarism, market fundamentalism and state terrorism. The prevalence of violence throughout American society suggests the need for a politics that not only negates the established order, but imagines a new one, one informed by a radical vision in which the future does not imitate the present.(27) In this discourse, critique merges with a sense of realistic hope and individual struggles merge into larger social movements. The challenge that young people are posing to American society is being met with a state-sponsored violence that is about more than police brutality; it is more importantly about the transformation of the United States from a social state to a warfare state, from a state that embraced the social contract to one that no longer has a language for community – a state in which the bonds of fear and commodification have replaced the bonds of civic responsibility and democratic vision. Until we address how the metaphysics of war and violence have taken hold on American society (and in other parts of the world) and the savage social costs it has enacted, the forms of social, political and economic violence that young people are protesting against as well as the violence waged in response to their protests will become impossible to recognize and act on.

To read other articles by Henry A. Giroux or other authors in the Public Intellectual Project, click here.

Footnotes:

1. See Loic Wacquant, “Punishing the Poor: The Neoliberal government of Social Insecurity” (Durham, NC: Duke University Press, 2009).

2. See here.

3. Kyle Bella, “Bodies in Alliance: Gender Theorist Judith Butler on the Occupy and SlutWalk Movements,” Truthout (December 15, 2011). Online here.

4. Richard Lichtman, “Not a Revolution?,” Truthout, (December 14, 2011).

5. Arun Gupta, Arundhati Roy: “The People Who Created the Crisis Will Not Be the Ones That Come Up With a Solution,” The Guardian UK, (12/01/2011). Online here.

6. Staughton Lynd, “What is to be Done Next?,” CounterPunch, (February 29, 2012).

7. Tony Judt, “The New World Order,” The New York Review of Books 11:12 (July 14, 2005), pp. 14-18.

8. Stuart Hall, “The Neo-Liberal Revolution,” Cultural Studies, Vol. 25, No. 6, (November 2011), p. 706.

9. Daniel Bell, “The End of Ideology: On the Exhaustion of Political Ideas in the Fifties” (New York: Free Press, 1966) and the more recent Francis Fukuyama, “The End of History and the Last Man” (New York: Free Press, 2006) .

10. Stuart Hall, “The March of the Neoliberals,” The Guardian UK, (September 12, 2011), online here.

11. Alex Honneth, Pathologies of Reason (New York: Columbia University Press, 2009), p. 188.

12. C. Wright Mills, The Power Elite (New York: Oxford University Press, 2000), p. 222.

13.13. See Gore Vidal, “Imperial America: Reflections on the United States of Amnesia” (New York: Nation Books, 2004); Gore Vidal, “Perpetual War for Perpetual Peace” (New York: Nation Books, 2002); Chris Hedges, “War is a Force that Gives Us Meaning” (New York: Anchor Books, 2003); Chalmers Johnson, “The Sorrows of Empire: Militarism, Secrecy and the End of the Republic” (New York: Metropolitan Books, 2004); Andrew Bacevich, “The New American Militarism” (New York: Oxford University Press, 2005); Chalmers Johnson, “Nemesis: The Last Days of the Republic” (New York: Metropolitan Books); Andrew J. Bacevich, “Washington Rules: America’s Path To Permanent War,” (New York, N.Y.: Metropolitan Books, Henry Hold and Company, 2010); Nick Turse, “The Complex: How the Military Invades Our Everyday Lives” (New York: Metropolitan Books, 2008).

14. Philip Govrevitch, “Whose Police?” The New Yorker, (11/17/11).

15. Phil Rockstroh, “The Police State Makes Its Move: Retaining One’s Humanity in the Face of Tyranny,” CommonDreams, (11/15/11). Online here.

16. Andrew Becker and G.W. Schulz, “Cops Ready for War,” RSN, (December 21, 2011). Online here.

17. Ibid.

18. Glenn Greenwald, “The Roots of The UC-Davis Pepper-Spraying,” Salon (Nov. 20, 2011). Online here.

19. Erica Goode, “Many in U.S. Are Arrested by Age 23, Study Finds,” The New York Times, (December 19, 2011) p. A15.

20. Michael Geyer, “The Militarization of Europe, 1914 – 1945,” in The Militarization of the Western World, ed. John R. Gillis (New York: Rutgers University Press, 1989), p. 79.

21. Tony Judt, “The New World Order,” The New York Review of Books 11:2 (July 14, 2005), p.17.

22. Zygmunt Bauman, “Life in Fragments” (Malden: Blackwell, 1995), p. 149.

23. Zygmunt Bauman, “Life in Fragments” (Malden: Blackwell, 1995), pp. 149-150.

24. Steve Herbert and Elizabeth Brown, “Conceptions of Space and Crime in the Punitive Neoliberal City,” Antipode (2006), p. 757.

25. Pascale-Anne Brault and Michael Naas, “Translators Note,” in Jean-Luc Nancy, “The Truth of Democracy,” (New York, NY: Fordham University Press, 2010), p. ix.

26. Smartypants, “A Failure of Imagination,” Smartypants Blog Spot (March 3, 2010). Online here.

27. John Van Houdt, “The Crisis of Negation: An Interview with Alain Badiou,” Continent, 1.4 (2011): 234-238. Online here.

Wikileaks: Internal Report Indicates U.S. Department Of Homeland Security Monitoring Occupy Wall Street Protests

Oldspeak:” ‘The internal DHS report emphasizes the need to “control protesters”, They talk about threats to ‘critical infrastructure’ and this fear that these protests are going to…make commerce difficult and people are going to start losing money. There is a kind of bottom line in analysis to what they’re talking about. There isn’t an emphasis on public safety in a way one would expect from a department that’s supposed to protect the homeland. It’s this sort of sense that they’re protecting somebody’s homeland, and they’re the folks who generally make all the money.” Michael Hastings COINTELPRO lives on. New Department, same ole shit. Still more evidence that your government does not represent you. It represents those folks who ‘generally make all the money.’ The financial services, and myriad of other anational corporations who gamble with other people’s money, homes and livelihoods; they profit  handsomely as billions of others struggle with debt, poverty, hunger, sickness, homelessness and joblessness. The vast majority of Americans are de-politicized, minimally informed & apathetic, with has paved the way for replacement of often heralded democratic ideals with inverted totalitarianism. Democracy has been subverted by men with million-dollar smiles, and the unwitting masses clamoring for more divestment from their liberties. “

Related Stories:

Obama Administration Coordinated Local Police Crackdowns On Occupy Encampments Nationwide

Occupy Wall Street “Counterinsurgency” Has Infiltrated Protests; Seeks To Diffuse Message

FBI To Expand Domestic Surveillance Powers As Details Emerge Of Its Spy Campaign Targeting American Activists

By Allison Kilkenny @ In These Times:

Rolling Stone’s Michael Hastings last night posted a story on an internal DHS report entitled “SPECIAL COVERAGE: Occupy Wall Street,” dated October of last year. The five-page report, part of five million newly leaked documents obtained by Wikileaks, sums up the history of the movement and assesses its “impact” on the financial services and government facilities.

In an interview on Citizen Radio, Hastings talked about the monitoring by DHS and also the leaked emails from Stratfor, a leading private intelligence firm Hastings describes as the “shadow CIA.”

The process of combing through the huge amount of leaked documents has only just begun, but Hastings considers the revelation that the government was keeping tabs on OWS to be the biggest news so far to come out of the latest dump.

The monitoring, or spying (depending on how generous one is feeling), process included DHS scouring OWS-related Twitter feeds.

“[DHS] was following all of the social networking activity that was going on among Occupy Wall Street,” says Hastings. “Now, I’m sure this is going to be spun tomorrow as this continues to grow that, oh, it’s just benign, DHS just used open source material to do this, and that’s true, but the question is: why is a large government bureaucracy who’s mandated to protect the homeland…monitoring very closely a peaceful political protest movement? They’re not monitoring the Democratic National Committee, they’re not monitoring Young Republican meetings. They’re monitoring Occupy Wall Street.”

The report emphasizes the need to “control protesters,” terminology Hastings finds troubling, along with DHS’s assertion that OWS will likely become more violent. Hastings calls that prediction “quite a leap,” as there is no evidence so far that the overwhelmingly peaceful movement is prone to become violent.

“[The report] names all the sort of groups [DHS is] worried about, one being Anonymous, this hacktivist group, but it also names the other people in Occupy Wall Street: labor unions, student groups,” Hastings says.

One might expect to read some hand-wringing over public safety concerns in a government document, and yet the DHS document appears to be more concerned with protecting the mechanisms of the financial sector than in ensuring the safety of citizens who are exercising their First Amendment rights.

“They talk about threats to ‘critical infrastructure’ and this fear that these protests are going to…make commerce difficult and people are going to start losing money. There is a kind of bottom line in analysis to what they’re talking about. There isn’t an emphasis on public safety in a way one would expect from a department that’s supposed to protect the homeland. It’s this sort of sense that they’re protecting somebody’s homeland, and they’re the folks who generally make all the money.”

This same business-over-people bias is present in the second major leak involving the Stratfor emails. ”When you go look at the back-and-forth, it’s all about, well, we have to protect lower Manhattan so the bankers can get to work on time.”

Hastings talks about two troubling tracks: In the DHS case, the U.S. government monitoring activist groups, and in the Stratfor case, large corporations paying a private intelligence firm to monitor other activist groups.

Dow Chemicals had Stratfor analyze the activities of Bhopal activists such as the Yes Men, who famously pranked the company by impersonating a Dow Chemical executive and publicly apologizing on the BBC for the Bhopal disaster that killed 8,000 people.

The list of Stratfor’s corporate clients is an impressive one, including Dow Chemicals and Coca-Cola. Clients are willing to pay the firm $40,000 for a subscription to Stratfor’s services (and additional huge sums of money for more services,) because the company bills itself as a private CIA, privy to high-level intelligence access.

“You have the DOW Chemicals situation, you have Coca-Cola hiring Stratfor to go after animal rights activists, to sort of keep tabs on them, and then also the question is: why would Stratfor have this Department of Homeland Security document, right? And the answer to that is Stratfor’s clients, or clearly Stratfor saw a business opportunity in keeping track, and figuring out how to handle protesters. In fact, in the email record…they’re talking about different tactics in lower Manhattan about, well, the streets are narrow down there, so if they push the protesters this way, or that way, that’s a better way to catch them. They’re drilling down into the best ways to kind of protect the financial services who are some of their clients.”

On Jan. 26, 2011, Fred Burton, the vice president of Stratfor, fired off an excited email to his colleagues: “Text Not for Pub. We have a sealed indictment on Assange. Pls protect.”

The question was: who did Burton mean by “we”?

“It’s like the Big Lebowski, right? The royal We,” says Hastings.

What Burton meant by “we” was the U.S. government.

“We know that the Department of Justice had been investigating Assange, and playing this game of oftentimes not explicitly saying what they were doing, but sort of threatening they would be doing this espionage investigation. We know that they’ve interviewed people in a grand jury, and then a few weeks ago with the Bradley Manning pre-trial that they were actually trying to make this espionage case against Assange,” says Hastings. “Burton claims that there in fact a secret U.S. indictment against Assange related, essentially, to espionage. That’s pretty big news.”

Hastings is braced for all of the typically condescending and dismissive remarks to come rolling in from the beltway in the wake of these latest leaks. In fact, the derision has already begun. One editor at The Atlantic called Wikileaks “a joke,” and dismissed the Stratfor emails out of hand.

Hastings expects others to say there’s no difference between a private intelligence firm and a newspaper or news bureau.

“I think that’s totally wrong. Journalists have sources and informants, but also our mission is to share that information with the public so the citizenry can make more informed decisions. Stratfor’s mission is to gather information so it can sell it to the highest bidder so corporations can essentially make more profit and get a competitive edge on their opponents,” he says.

That kind of knee-jerk dismissiveness strikes of bad journalism, according to Hastings. While no cheerleader for Wikileaks – during the interview, Hastings admitted there’s a lot of stuff one can criticize Wikileaks about, particularly the practice of releasing large amounts of data that hasn’t been reviewed very carefully – he still finds the overall work done by the group extremely newsworthy.

“What news organization has had a bigger impact than Wikileaks? Iraq war logs, Afghan war logs, the Cablegate. These are important stories. This is news. DHS was monitoring Occupy Wall Street. That’s a story, and it’s a significant story. We’re talking about Occupy Wall Street: one of the biggest grassroots, political movements that we’ve seen in a generation and the government’s response to that.”

One of the most worrying aspects to the Stratfor story is the privatizing of yet another typically goverment-only function. Like Blackwater, here is another shadowy private agency doing the work usually done by the U.S. government, a recipe, as we’ve learned time and time again, for unaccountability and disaster.

Also, Stratfor is ripe for the revolving door effect.

“It’s a chance for people who worked in government in these various intelligence agencies to, once they leave, to have lucrative positions where they’re able to — in the same way some politicians become lobbyists to ply off their old contacts — to have these great, well-paying positions where they can use their former intelligence contacts and sell their services in the corporate world,” says Hastings.

To naysayers claiming there’s nothing wrong with former government officials capitalizing on their particular skill sets, Hastings responds, “Once you start spying on activists, and peaceful protesters, then I would say that’s very troubling.”

Obama White House Has Weakened More Lobbyist-Opposed Health, Public Safety Regulations Than Bush Administration

Oldspeak:”A new report shows that despite a campaign pledge to get lobbyists out of Washington, the Obama White House has weakened regulation in favor of corporate interests more than the Bush administration. The report deals with issues that are of concern to every American; smog in our cities, collapsing mine shafts that kill workers in West Virginia, the Deepwater Horizon spill in the Gulf of Mexico, salmonella in peanut paste, a whole variety of public health threats that agencies of the government were set up to avoid. Unfortunately, although we expected a bright new future with President Obama, he has disappointed us in this area to a large extent, inserting politics and pandering to special interests rather than letting science and technology reign.”-RENA STEINZOR. Yet another campaign promise gone unfulfilled. Sadly, due to the frightfully inept and unelectable presidential alternatives offered by Republicans, it’s not likely Obama will be held accountable to the long list of changes for the worse he’s presided over. Moral of the story? The Corporatocracy rules, no matter who you ‘vote’ for. More change I can’t believe in.

Related Story:

“Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety and the Environment”

By Amy Goodman @ Democracy Now:

A new report shows that despite a campaign pledge to get lobbyists out of Washington, the Obama White House has weakened regulation in favor of corporate interests more than the Bush administration. The study, “Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety, and the Environment,” examines more than a thousand meetings that took place over a decade between lobbyists and a little known regulatory office, then checks to see how proposed rules were weakened to accommodate industry requests. It found the Obama White House changed rules 76 percent of the time, while Bush changed them just 64 percent of the time. EPArules were changed at a significantly higher rate — 84 percent. We speak to the report’s lead author, Rena Steinzor, professor at the University of Maryland Carey School of Law and President of the Center for Progressive Reform.

AMY GOODMAN: As we end on a new report that shows despite President Obama’s campaign pledge to get lobbyists out of Washington, the White House has weakened regulation in favor of corporate interests even more than the Bush administration. The study examines more that 1,000 meetings that took place over a decade between lobbyists and a little known regulatory office, then checks to see how proposed rules were weakened to accommodate industry requests. It found the Obama White House changed rules 76% of the time while the Bush administration changed them just 64% of the time. EPA rules were changed a significantly higher rate, 84%.

NERMEEN SHAIKH: Much of this is due to the man Obama appointed to the head of House of Information and Regulatory Affairs, through which all proposed regulation must pass. Cass Sunstein is know for his academic work on the risks of overregulation. Well, for more we’re joined from Washington, D.C. by Rena Steinzor, Professor at the University of Maryland Carey School of Law and President of the Center for Progressive Reform. She’s the lead author of this exhaustive report, “Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety, and the Environment.” Rena, welcome to Democracy Now!. Can you talk about this report?

RENA STEINZOR: The report deals with issues that are familiar and of concern to every American; smog in our cities, collapsing mine shafts that kill workers in West Virginia, the Deepwater Horizon spill in the Gulf of Mexico, salmonella in peanut paste, a whole variety of public health threats that agencies of the government were set up to avoid. Unfortunately, although we expected a bright new future with President Obama, he has disappointed us in this area to a large extent, inserting politics and pandering to special interests rather than letting science and technology reign.

AMY GOODMAN: Rena Steinzor, the issue of the smog regulations that so blindsided the Administrator of the EPA, Lisa Jackson.

RENA STEINZOR: Yes, Lisa Jackson, was—-when she was appointed there was tremendous relief and joy in the community of public health experts and environmentalists who watch EPA. And she immediately stepped in to try and get a lot of these rules, which were mandated by Congress, back on track and promised to repair the damage that was left by George W. Bush. But, this small office in the White House, which panders to special interests, stepped in and was the president’s point person, point agency to destroy her efforts to strengthen these protections. And anyone who lives in a major American city knows Code Red days when children are not allowed to play outside because the air pollution is so bad.

AMY GOODMAN: We have 15 seconds, if you can summarize what happened.

RENA STEINZOR: Really, it is remarkable that an effort to clean up smog in American cities should be killed by an office at the White House that caters to special interests.

AMY GOODMAN: Rena Steinzor, we will link to your report, Professor at the University of Maryland Carey School of Law, President of The Center for Progressive Reform, lead author in this report, “Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety, and the Environment.”

 

International Monatary Fund Report: Inequality Increases National Debt

Oldspeak: “WOW. You know it’s real when the financial arm of the Corporatocracy puts out a report that runs counter to the very corprocratic policies which have created the rampant inequality and crushing debt contagion that has gripped the planet. “This month, International Monetary Fund economists demonstrated that higher income inequality in developed countries is associated with higher domestic and foreign indebtedness. Leading economists agree that rampant inequality leads to unstable economies and depressions, and makes the middle and lower classes poorer.” Shocker. Turns out, it’s not entitlement programs, public employees’ pensions, and non-military spending that drives debt. It’s inequality, poverty, and debt creation. Could this report signal dissention in the ranks? Very little discussion of this corportate media.”

By Washington’s Blog:

 

Inequality Creates Economic Instability and Widespread Poverty

Leading economists agree that rampant inequality leads to unstable economies and depressions, and makes the middle and lower classes poorer.

Inequality Increases National Debt

This month, International Monetary Fund economists demonstrated that “higher income inequality in developed countries is associated with higher domestic and foreign indebtedness”:

We find (see Chart 1) thatwhat unites the experiences of the main deficit countries is a steep increase in income inequality over recent decades, as measured by the share of income going to the richest 5 percent of the country’s income distribution.

This increase in inequality has contributed to a deterioration in the richest countries’ aggregate savings-investment balances, as the poor and middle class borrowed from the rich and from foreign lenders. This, along with the other factors mentioned above, can fuel current account deficits.

***

The increase in debt happens over the decades of below-trend incomes that result from the persistent shock. In an open economy, the task of financing the bottom group’s borrowing demand following a negative income shock is shared between the domestic top group and foreigners. This enables the top group to deploy more of its higher income in domestic plant and machinery investment and consumption than would be possible in a closed economy. But externally the result is a deterioration of the current account, which peaks at more than 1 percent of GDP.

In reality, increases in income inequality are often followed by political interventions to prop up the living standards of the bottom group, whose real income is stagnating. This is generally done not by directly confronting the sources of inequality, such as declines in the collective bargaining power of the bottom group or shifts in the tax burden from the top group to the bottom group, but rather by promoting policies that cut the cost of borrowing for both individuals and financial institutions (Rajan, 2010). These policies include domestic and international financial liberalization, and they put additional downward pressure on current accounts.

As shown in the simulations in Chart 2 (solid line), a reduction in financial intermediation spreads leads to much lower lending rates, which draw more of the top group’s resources into financial rather than real assets. Initially this allows the bottom group to maintain a much higher consumption level. But in the long run it means the top group underinvests in real assets such as plants and machinery, and so the bottom group sees lower real wages over time. At the same time, debt-to-income ratios rise more strongly, as do current account deficits.

***

If lending is liberalized without addressing the underlying income inequalities, the result would simply be an increase in indebtedness within surplus countries (between the rich and the rest of the population), rather than vis-à-vis the rest of the world. In other words, there would be a globalized rather than a regional increase in domestic indebtedness of the poor and middle class. While this would reduce cross-border financial imbalances, it would exacerbate domestic debt-to-income ratios and thus vulnerability to crises. In the long run, there is therefore simply no way to avoid addressing the income inequality problem head-on. Financial liberalization in surplus countries buys time, but at the expense of an eventually much larger debt problem.

Conservatives and Liberals Agree: Government Should Not Worsen Inequality

Conservatives tend to be much more worried about debt than liberals. Given the fact that – as shown above – runaway inequality fuels debt, conservatives should be against policies that make inequality even worse. As I noted in July:

Inequality in the United States is at insane levels. Inequality among Americas is worse than in Egypt, Tunisia or Yemen. As NPR notes, inequality is higher in the U.S. than in many banana republics in Latin America. And social mobility is lower in America than in most European countries (and see this, this and this).

In fact, most conservatives already are against insane levels of inequality.

Obama’s “American Jobs Act”: Why Less Is More Of The Same

President Barack Obama holds a copy of the American Jobs Act while announcing he is sending the $447 billion jobs package, his plan to create job growth, to Congress. (Photo: Philip Scott Andrews/The New York Times)

Oldspeak: “Look beyond the rhetorical wizardry.  What we got from Obama was a 2009 “Stimulus Light” proposal. This so-called “American Jobs Act” is 60% tax cuts (which don’t create jobs), half the size of the 2009 stimulus (that already wasn’t big enough to create jobs and had the NET EFFECT OF CUTTING JOBS), is too light on shovel-ready jobs (Construction and infrastructure jobs are long term. What is needed today is IMMEDIATE job creation.) Is too heavily weighted in favor of subsidies to the states (Local government laid off hundreds of thousands of workers since June 2009 despite the $263 billion in subsidies received) and does not go far enough in taxing the rich. Why is this man touring the country passionately selling a proposal that won’t work for the vast majority of the American people, and is basically another massive giveaway to the rich? Nevermind the fact that it doesn’t compel the banking cartels to lend the trillions they’re hoarding to small business owners which would create the conditions for job creation. Nor does it compel large multinational corporations to stop hoarding the trillions in tax savings they have stashed offshore to create jobs in the U.S. Obama has already bestowed the Corporatocracy with 1 TRILLION in tax cuts the past 2 years, why is he trying to give them more? Look no further than his list of campaign contributors. While the fact that legions of ordinary americans have contributed to him has been played up in corporate media, his biggest and most influential donors are wall street banks, hedge fund managers, media conglomerates, dirty energy conglomerates, big business interests, all denziens of the Corporatocracy. And what have the American people received in return? Toothless financial reform, expanded support for dirty energy policy, Business friendly health care reform, media and communications consolidation, weaker regulation, utterly ignored poor and working poor. Oh and 6 wars. Quid pro quo par excellence. More change I can’t believe in.”

By Jack Rasmus @ Truthout: 

On Thursday, September 8, President Obama proposed a $474 billion “Jobs Act.” What we got from Obama was a 2009 “Stimulus Light” proposal, with all the problems of the prior 2009 stimulus package in the form of inadequate magnitude of spending, wrong composition and targets and bad timing.

First, on the matter of the magnitude of spending in the proposal, some think it was bold. But put it in context; $447 billion just won’t achieve the job creation it claims. It’s once again too little for an economy the size of the US, for an economy in as deep an economic hole as it is and in an economy facing growing downward momentum at home in the context of a global economy also rapidly slipping.

In February 2009, President Obama proposed $787 billion in economic stimulus. Unemployment was about 25 million. More than two years later, after the $787 billion has been spent, unemployment (measured by the Labor Department’s U-6 rate) is still around 25 million. Why, therefore, should Obama’s latest proposals to create jobs, consisting about half the size of the 2009 stimulus, expect to create jobs when the larger stimulus did not?

Even more important than Obama’s Jobs Act’s insufficient magnitude, the composition is also seriously deficient – just as was the 2009 stimulus. Like the stimulus in 2009, it is once again overloaded in tax cuts. In fact, a greater percentage (60 percent) of the total Jobs Act is composed of tax cuts than was the 2009 stimulus (38 percent). Then and now, tax cuts simply cannot and will not create jobs, given the kind of “epic” recession in which the US economy now finds itself entrapped.

The 38 percent tax cut mix in 2009 amounted to about $300 billion in total tax reduction. That $300 billion followed a $90 billion tax cut less than nine months before in spring 2008. Another $50 billion in tax cuts was further added later in 2009-2010 in various bills and administrative actions. That’s a total of $440 billion in tax cuts. There’s more. Add to that $440 billion another $270 billion in Bush tax cut extensions in late 2010 for 2011, plus another $100 billion in this year’s payroll tax cut. Now, add the Job Act’s tax-heavy $270 additional billion. Now, we’re well over $1 trillion in tax cuts in just the past two years. And what’s been the result in jobs? Still 25 million unemployed today as in June 2009.

If someone needs still further evidence that tax cuts don’t create jobs in today’s environment, just step back a decade. In 2001-2004 George W. Bush passed another $3 trillion in tax cuts, overwhelmingly biased again toward the rich and their corporations in the form of capital gains, dividends, inheritance, business depreciation, and other corporate largesse. Over 80 percent of the $3 trillion went to the wealthiest 20 percent households and most of that to the wealthiest 5 percent and 1 percent. And what kind of job creation resulted? We had the longest jobless recession in US history up to that point. It took 46 months just to recover to the level of jobs we had before the first Bush recession in 2001.

Furthermore, most of the jobs that were created under Bush were in the finance and housing sectors of the economy at the time, which were both undergoing a boom due to speculative excesses before an eventual bust. The jobs mostly created in finance and housing had little to do with Bush’s tax cuts of 2001-2004, however. Instead, millions of jobs were being lost in manufacturing while the tax cuts were taking effect last decade.

In 2004, Bush also pushed through a bill to allow multinational corporations to repatriate their then $700 billion hoard of cash they were keeping offshore in their subsidiaries in order to avoid paying the US 35 percent corporate tax rate. The multinationals blackmailed Congress to let them pay only 5.25 percent instead of 35 percent. In exchange, they said they’d bring back the money (saving 29.75 percent for themselves) and use it to create jobs. Did they? No. They money brought back was used to buy back their stock, payout more dividends and to use for mergers and acquisitions that, in fact, resulted in fewer jobs. Now the same “game” is being proposed in Congress, except this time their offshore cash hoard is $1.2 trillion.

The historical record of the past decade is clear: tax cuts simply don’t create jobs, especially tax cuts for the rich and corporations. So, why has Obama given them $1 trillion in tax cuts the past two years and now proposes more?

But Obama’s once again tax-heavy proposal is not the only problem with his “Jobs Act.” The Jobs Act shares another deficiency with the president’s prior 2009 stimulus. It’s too heavily weighted in favor of subsidies to the states as well. The 2009 stimulus provided $264 billion in subsidies to the states. It was supposed to create jobs. It didn’t. Local government laid off hundreds of thousands of workers since June 2009 despite the $263 billion. What guarantees are there that this won’t be repeated when they’re given the added subsidies? Will they get the subsidy only if they first prove they’ve added the jobs? Don’t count on it.

Another problem with the “composition” of the Jobs Act announcement by the president is it once again repeats the promise of the 2009 stimulus that infrastructure spending will quickly create jobs. In 2009, about $100 billion was allocated to infrastructure-related spending that was supposed to create four million jobs. That didn’t happen. There were 6.4 million construction workers employed in June 2009. There are 5.5 million today. Nearly a million fewer construction jobs was the result. There just weren’t as many “shovel-ready” jobs as was claimed. Construction and infrastructure jobs are long term. What is needed today is immediate job creation. Infrastructure programs just won’t cut it, especially when they are of the minimal magnitude in Obama’s recent proposal.

Obama promised his proposals would focus on small business by subsidizing their hiring of workers for each job they create. But for small businesses to create jobs, it needs more than a partial hiring subsidy. It needs funds in addition to cover all the other costs of production. For that, small businesses need bank loans. And for two years now, they just can’t get the loans from the big banks. Bank lending to small businesses declined for 15 consecutive months after June 2009, and it’s not much better today. Obama and the Federal Reserve bailed out the big banks to the tune of $9 trillion in recent years, in the expectation they would start lending. They didn’t. They still aren’t. Like the big corporations hoarding their $2 trillion and not creating jobs, the big banks are hoarding their cash reserves as well and not lending to small businesses that might create jobs if they could get the loans. Obama would have done better to propose the federal government bypass the banks and directly loan to small businesses at 0.25 percent. After all, that’s the interest rate at which the Fed today “loans” to the big banks. No, I take that back. Actually it’s only 0.1 percent and then the Fed pays the banks 3 percent to temporarily park the free money with the Fed in the interim. What a deal: the Fed pays the big banks to take its free money.

In summary, what we got from Obama’s “Jobs Act” was more of the same in terms of poor composition (i.e. excessively tax cut heavy), poor timing (long-term infrastructure projects) and too little magnitude of spending in any event.

There’s no reason to believe that the Obama jobs package that repeats the problems of poor composition and bad timing of the 2009 stimulus – which didn’t create, although it may have saved some jobs – is going to do any better when it’s also half the size of the stimulus.

Of course, the proposed Jobs Act won’t pass anyway because the Teapublicans will oppose it. At best, they might try to cherry-pick out the business tax cuts proposed by Obama and then add even more tax cuts to the “Jobs Act” – a proposal which anyway should be appropriately renamed “The Business Tax Cut Expansion Act of 2011.”

Just a day before the president’s address, the Teapublican candidates gathered to hold their latest debate. They stumbled all over each other to see who could promise corporate America even greater tax cuts. Rick Perry even promised to end all corporate taxes. Rick Santorum promised to lower capital gains and dividends taxes to zero. Others proposed no income taxes whatsoever for earners of $200,000 income a year. Grovel for those campaign contributions, fellas. These same candidates, after proposing cutting hundreds of billions a year in tax cuts for the rich and corporations, will turn around and cry about the budget deficits and demand equivalent cuts in Social Security, Medicare and Medicaid to make up for their ever generous handouts to the wealthy.

But this kind of mercenary, Robin-Hood-in-reverse policy of “No taxes whatsoever” for the rich and their corporations is expected from the radical right. Yet, it seems Obama is being drawn into their tax-cut-for-the-rich frenzy with his proposal for yet another $270 billion in cuts. He just agreed, less than nine months ago, to give them $270 billion by extending the Bush tax cuts last December. Now, he proposes hundreds of billions of dollars more. This past year witnessed the president’s adopting their central agenda demand to cut deficits. Could he now be tailing the Teapublicans once again down the “Cut more taxes for Corporate America” road as well?

A real jobs program today would be proposals and programs to recreate, in 21st century form, a Works Progress Administration – paid for not by giving the rich and their corporations still more tax cuts, but by taxing their $2 trillion cash hoard, their $1 trillion in excess free Fed money bank reserves, their $1.2 trillion held in offshore subsidiaries and by taxing the more than $6 trillion they’ve all stashed away in their tax havens around the globe from the Cayman islands to the Seychelles to Vanuatu and, of course, Switzerland.

Politics in America today, sadly, is not about what will ensure true economic recovery and give the 25 million Americans a job. It’s about how to extend tax cuts for corporate America and its shareholder beneficiaries; it’s about how to ensure the Great American Tax Shift of recent decades is never rescinded and instead further extended; and it’s about how to make everyone else in American pay for their bailouts so that the corporations and wealthiest themselves do not have to.

Systems Collapse When The Irrational Is Considered Rational

Oldspeak:“One of the most essential, and immutable facts of life on this planet. So basic, so simple, yet supposedly educated, thoughtful, and experienced men have systematically, intentionally and aggressively ignored it. We see the results before us. 1930′s era inequality, upward transfer and concentration of wealth, intractable debt, 6 wars, a wholly co-opted, corporatized, and corrupted political class, controlled by an unseen and unelected shadow government controlled primarily by global bankers and power brokers. ’A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.’ -Woodrow Wilson, after signing the Federal Reserve into existence. So the system collapses, the corporatocracy profits off of it, further concentrating wealth and power in their hands, leaving the People ever more vulnerable and helpless against their smiling and reassuring domination, while simultaneously depriving the People of their inalienable rights to protest, dissent and resist. I fear only when the seductive and alluring artifice of this cosmetic, consumption, competition, communitainment, and copulation-driven unreality that’s been engineered for us to exist in starts to fall away will the People consciously awaken to actual reality, and by then, it will be too late.  There’s a question that I find rattling around in my head when I walk the streets of New York, with millions bustling by blissfully oblivious to reality…. ‘What happens when it all falls down? When this entirely unsustainable way of life we hold so dear, the infinite growth model, the technology, the incessant communitainment distractions, the destruction in the name of peace, the convenience, the plentiful food, water, and energy, what happens when all that is no longer sustainable and goes away?’ More of us need to devote more time and energy to answering those questions because the time is fast approaching when we will have no choice but to.  ”Ignorance is Strength.“, “Freedom is Slavery.” “War is Peace.“

Related Video:

Bill Moyers PBS “The Secret Government” – 1987 

 

Related Story:

A Hidden World Growing Beyond Control

By Danny Schecter @ Disinformation:

Oh thank you, Wikipedia, for this definition:

“Irrationality is cognition, thinking, talking or acting without inclusion of rationality. It is more specifically described as an action or opinion given through inadequate reasoning, emotional distress, or cognitive deficiency. The term is used, usually pejoratively, to describe thinking and actions that are, or appear to be, less useful or more illogical than other more rational alternatives.”

And what about this one? Market Psychology?  This term is defined in the Investopedia this way:

“The overall sentiment or feeling that the market is experiencing at any particular time. Greed, fear, expectations and circumstances are all factors that contribute to the group’s overall investing mentality of sentiment.”

Q: What do we have when we put the two together?

A: The current madness and market mayhem.

S&P’s downgrade is being blamed for the market panic even though all the business media expected a downgrade and initially minimized its potential impact. The ratings agency blamed the government’s failure to deal with the debt including the stalemate in Congress.

The Republicans, predictably blamed Obama and the Democrats went after the Tea Party as the culprits behind the market plunge. But then, investors who at first denied that a downgrade would be significant overreacted to it by pumping more money into government treasuries adding to government debt.

The Comedy Channel’s Jon Stewart’s sensible reaction: “are you f*cking kidding me?”

Does this make any sense?

We are taught to think of businessmen and their minions as absolute worshipers of objective truth as they allegedly practice “due diligence” to confirm underlying facts and insure that their decisions are based on research and thoughtful decisions.

That’s what we are taught—but is that what they do?

In fact, the “smartest guys in the room” as the Enronians were called proved to be the dumbest, buying into a warped worldview, and then, believing their own hype leading to decisions that brought the house down.

And that’s what happens again and again, over and over, as panic seizes The Street followed by a herd of decision makers making bad decisions.

Paul Farrell has written about this phenomenon on Marketwatch.

He speaks of all the too-greedy-to-fail fatheads running Wall Street? And, unfortunately, Main Street America’s 95 million irrational and self-sabotaging investors

Yes, all of us! We’re Americans. Don’t confuse us with the facts, with reality. We’re the greatest in history, a legend in our own minds. And a rapidly mutating virus is spreading this lethal pandemic far beyond the shores of Lake Wobegon. Yes, folks, the “Lake Wobegon Effect” is hard-wired in America’s brain, an illusion of superiority, a smug arrogance where each knows we are the best, the chosen ones.

Warning: The Lake Wobegon Effect is the single best summary of today’s stock market psychology, high frequency trading, behavioral economics theories and the new science of irrationality … and it’s sucking the life out of America’s soul. Here, listen to more of these arrogant musings surfacing everywhere from deep in our collective brains.

So forget all of our devices, our forever present blackberries, iPhones, iPads and Bloomberg terminals with their enhanced graphics and multiple sources. Alas, there’s no panic button that gives you a quick dose of financial history, perspective or context. Our hi-tech world often leads to repeating low-tech mistakes in a speeded up environment driven byall those dazzling terminals. TVscreens blazing and the pundits buzzing.

Farrell reminds us of a psychological game called “The Invisible Gorilla.”

He calls it “one of the most famous psychological demos ever. Subjects are shown a video, about a minute long, of two teams, one in white shirts, the other in black shirts, moving around and passing basketballs to one another. They are asked to count the number of aerial and bounce passes made by the team wearing white, a seemingly simple task.”

Stop. Test yourself before you read on. What does “The Invisible Gorilla” study tell you about the brains of folks gambling in Wall Street’s casinos? Where billions of shares, trillions of dollars, stocks, bonds, derivatives trade daily? What’s “invisible” to you?”

Institutionalized Irrationality—perhaps even insanity— helped cause the financial crisis as the federal inquiry commission pointed out quoting an appraiser who watched the real estate industry underwrite loans with no collateral over and over again:

“I see a lot of irrationality,” he added. He said he was unnerved because people were saying, “It’s different this time”—a rationale commonly heard before previous collapses.”

Many writers of distinction could see the irrational trumping the rational coming, as I wrote in my book Plunder that came out a month before the 2008 crash.

I quoted Mark Twain, America’s greatest man of letters, He once asked, “Why shouldn’t truth be stranger than fiction? Fiction, after all, has to make sense.” (His novella, The Man Who Corrupted Hadleyburg, was written while he was in Europe on the run from creditors.)

Fast forward a century or more as business and political leaders alike try to make sense of a relatively sudden and unexpected market meltdown in the summer of 2007 then again in 2008 and then again this past week.

Ultimately perhaps Twain’s insight will lead to great novels that will capture the corruption of the underlying culture that allowed so many financial manipulations and so much greed, avarice, and irrationality in this era in the way that great writers of economic upheaval in America like Upton Sinclair, John Dos Passos, or Jack London castigated theirs.

It seems to have always been true, as a friend who watched his multi- ethnic city of Sarajevo implode into a bloody genocidal war in Bosnia years ago confided to me, “Only fiction has to be plausible. Real life has no such constraint.”

As a journalist with perhaps less fictional imagination than I need, I can only try to probe deeply into some of the forces that took our economy down in such an unexpected way at a time when our national leaders were looking elsewhere and thought they saw the only threat to our country coming from terrorists hiding in caves in far away lands.

They – and I include among them, representatives of both parties, and most of our mass media – ignored cries for help from victims of predatory lenders dating back into the 1990s, and, then, for years warnings from David Walker, the Comptroller of our Currency and head of the Government Accounting Office (GAO) that our growing debt burden could lead to a sudden collapse threatening our national security. He had been labeled “Dr. Gloom” for his sobering prognostications. In February, 2008, he stepped down from government, frustrated by his inability to promote changes.

A closer look, usually in times of crisis, offers a window into another kind of financial world, a world of panic and fear, where irrationality is the order of the day, an irrationality that goes by the name of “Market Psychology.”

Forget the bulls or the bears…this is a world of sharks deeply in need of shrinks.

When things go well, the wizards of Wall Street are anointed by the media as geniuses. When they don’t, you get Time Magazine’s condescending putdown of “Wall Street’s mad scientists blowing up the lab again.”

This kind of humor seems out-of-place when we are talking about what many fear has lead to the collapse or at least a severe wounding of the global economy with millions of jobless and homeless victims who believed in the system until it failed them.

And yet, as we saw in the great manufactured budget stalemate in Washington, members of Congress were and still are prepared to trigger a collapse in the name of a naïve but rigid ideology.

Some of us argue with them thinking our facts can refute theirs but at bottom, fanaticism is not neutralized by rational argument. You need countervailing power and a willingness to fight for another vision.

Filmmaker and News Dissector Danny Schechter edits Mediachannel.org.

America In Decline

  Oldspeak:” ‘American decline is in no small measure self-inflicted. The comic opera in Washington this summer, which disgusts the country and bewilders the world, may have no analogue in the annals of parliamentary democracy.  The spectacle is even coming to frighten the sponsors of the charade. Corporate power is now concerned that the extremists they helped put in office may in fact bring down the edifice on which their own wealth and privilege relies, the powerful nanny state that caters to their interests. By shredding the remnants of political democracy, the financial institutions lay the basis for carrying the lethal process forward – as long as their victims are willing to suffer in silence.’-Noam Chomsky. Quickest and least painful ways to eliminate U.S. debt that aren’t being discussed? Withdraw from foreign wars, slash the ‘defense budget, nationalize health care, cut subsidies for dirty energy (oil, natural gas, nuclear, coal) and invest heavily in clean energy (wind, solar, wave, geothermal, hydrogen, elecrtic) , end tax breaks for corporations and the top 1% and institute a financial transactions tax. Unfortunately none of these common sense solutions will be seriously explored with a government for the corporatocracy, by the corporatocracy.

By Noah Chomsky @ Truthout:

 

“It is a common theme” that the United States, which “only a few years ago was hailed to stride the world as a colossus with unparalleled power and unmatched appeal is in decline, ominously facing the prospect of its final decay,” Giacomo Chiozza writes in the current Political Science Quarterly.The theme is indeed widely believed. And with some reason, though a number of qualifications are in order. To start with, the decline has proceeded since the high point of U.S. power after World War II, and the remarkable triumphalism of the post-Gulf War ’90s was mostly self-delusion.

Another common theme, at least among those who are not willfully blind, is that American decline is in no small measure self-inflicted. The comic opera in Washington this summer, which disgusts the country and bewilders the world, may have no analogue in the annals of parliamentary democracy.

The spectacle is even coming to frighten the sponsors of the charade. Corporate power is now concerned that the extremists they helped put in office may in fact bring down the edifice on which their own wealth and privilege relies, the powerful nanny state that caters to their interests.

Corporate power’s ascendancy over politics and society – by now mostly financial – has reached the point that both political organizations, which at this stage barely resemble traditional parties, are far to the right of the population on the major issues under debate.

For the public, the primary domestic concern is unemployment. Under current circumstances, that crisis can be overcome only by a significant government stimulus, well beyond the recent one, which barely matched decline in state and local spending – though even that limited initiative probably saved millions of jobs.

For financial institutions the primary concern is the deficit. Therefore, only the deficit is under discussion. A large majority of the population favor addressing the deficit by taxing the very rich (72 percent, 27 percent opposed), reports a Washington Post-ABC News poll. Cutting health programs is opposed by overwhelming majorities (69 percent Medicaid, 78 percent Medicare). The likely outcome is therefore the opposite.

The Program on International Policy Attitudes surveyed how the public would eliminate the deficit. PIPA director Steven Kull writes, “Clearly both the administration and the Republican-led House (of Representatives) are out of step with the public’s values and priorities in regard to the budget.”

The survey illustrates the deep divide: “The biggest difference in spending is that the public favored deep cuts in defense spending, while the administration and the House propose modest increases. The public also favored more spending on job training, education and pollution control than did either the administration or the House.”

The final “compromise” – more accurately, capitulation to the far right – is the opposite throughout, and is almost certain to lead to slower growth and long-term harm to all but the rich and the corporations, which are enjoying record profits.

Not even discussed is that the deficit would be eliminated if, as economist Dean Baker has shown, the dysfunctional privatized health care system in the U.S. were replaced by one similar to other industrial societies’, which have half the per capita costs and health outcomes that are comparable or better.

The financial institutions and Big Pharma are far too powerful for such options even to be considered, though the thought seems hardly Utopian. Off the agenda for similar reasons are other economically sensible options, such as a small financial transactions tax.

Meanwhile new gifts are regularly lavished on Wall Street. The House Appropriations Committee cut the budget request for the Securities and Exchange Commission, the prime barrier against financial fraud. The Consumer Protection Agency is unlikely to survive intact.

Congress wields other weapons in its battle against future generations. Faced with Republican opposition to environmental protection, American Electric Power, a major utility, shelved “the nation’s most prominent effort to capture carbon dioxide from an existing coal-burning power plant, dealing a severe blow to efforts to rein in emissions responsible for global warming,” The New York Times reported.

The self-inflicted blows, while increasingly powerful, are not a recent innovation. They trace back to the 1970s, when the national political economy underwent major transformations, ending what is commonly called “the Golden Age” of (state) capitalism.

Two major elements were financialization (the shift of investor preference from industrial production to so-called FIRE: finance, insurance, real estate) and the offshoring of production. The ideological triumph of “free market doctrines,” highly selective as always, administered further blows, as they were translated into deregulation, rules of corporate governance linking huge CEO rewards to short-term profit, and other such policy decisions.

The resulting concentration of wealth yielded greater political power, accelerating a vicious cycle that has led to extraordinary wealth for a fraction of 1 percent of the population, mainly CEOs of major corporations, hedge fund managers and the like, while for the large majority real incomes have virtually stagnated.

In parallel, the cost of elections skyrocketed, driving both parties even deeper into corporate pockets. What remains of political democracy has been undermined further as both parties have turned to auctioning congressional leadership positions, as political economist Thomas Ferguson outlines in the Financial Times.

“The major political parties borrowed a practice from big box retailers like Walmart, Best Buy or Target,” Ferguson writes. “Uniquely among legislatures in the developed world, U.S. congressional parties now post prices for key slots in the lawmaking process.” The legislators who contribute the most funds to the party get the posts.

The result, according to Ferguson, is that debates “rely heavily on the endless repetition of a handful of slogans that have been battle-tested for their appeal to national investor blocs and interest groups that the leadership relies on for resources.” The country be damned.

Before the 2007 crash for which they were largely responsible, the new post-Golden Age financial institutions had gained startling economic power, more than tripling their share of corporate profits. After the crash, a number of economists began to inquire into their function in purely economic terms. Nobel laureate Robert Solow concludes that their general impact may be negative: “The successes probably add little or nothing to the efficiency of the real economy, while the disasters transfer wealth from taxpayers to financiers.”

By shredding the remnants of political democracy, the financial institutions lay the basis for carrying the lethal process forward – as long as their victims are willing to suffer in silence.

(Noam Chomsky’s most recent book is ”9-11: Tenth Anniversary.” Chomsky is emeritus professor of linguistics and philosophy at the Massachusetts Institute of Technology in Cambridge, Mass.)

© 2011 Noam Chomsky

The U.S. & The Five Stages Of Collapse

Oldspeak: When I first read this 3 years ago, I could shrug it off. Today, in the wake of the first downgrading of U.S. debt EVER; it’s glaringly obvious that in the U.S. Stage 1. Financial collapse is very far along. Stages 2 and 3, Commercial and political collapse are in progress. Stages 4 and 5 social and cultural collapse are in progress in many parts of the U.S. At some point all the communitainment in the world won’t prevent us from acknowledging the actual reality happening around us.  We’ve seen this movie before in the 1920s-30s. Extreme inequality, oligarchy, rampant joblessness, austerity, deflationary policy, Acute consolidation of power and influence in the hands of a monied few. It’s unfortunate that the U.S. has not learned the lessons of its history. At some point we will have no choice but to heed the lessons from The U.S.S.R., Rome, The Maya, Mesopotamia, and other great empires the have risen and fallen in much the same way. U.S. Default is not a matter of if, but when. Printing money and raising the debt ceiling can only put off the inevitable for so long. We have to have serious discussion about what happens after. “

By Dmitri Orlov @ Energy Bulletin:

Hello, everyone! The talk you are about to hear is the result of a lengthy process on my part. My specialty is in thinking about and, unfortunately, predicting collapse. My method is based on comparison: I watched the Soviet Union collapse, and, since I am also familiar with the details of the situation in the United States, I can make comparisons between these two failed superpowers.

I was born and grew up in Russia, and I traveled back to Russia repeatedly between the late 80s and mid-90s. This allowed me to gain a solid understanding of the dynamics of the collapse process as it unfolded there. By the mid-90s it was quite clear to me that the US was headed in the same general direction. But I couldn’t yet tell how long the process would take, so I sat back and watched.

I am an engineer, and so I naturally tended to look for physical explanations for this process, as opposed to economic, political, or cultural ones. It turns out that one could come up with a very good explanation for the Soviet collapse by following energy flows. What happened in the late 80s is that Russian oil production hit an all-time peak. This coincided with new oil provinces coming on stream in the West – the North Sea in the UK and Norway, and Prudhoe Bay in Alaska – and this suddenly made oil very cheap on the world markets. Soviet revenues plummeted, but their appetite for imported goods remained unchanged, and so they sank deeper and deeper into debt. What doomed them in the end was not even so much the level of debt, but their inability to take on further debt even faster. Once international lenders balked at making further loans, it was game over.

What is happening to the United States now is broadly similar, with certain polarities reversed. The US is an oil importer, burning up 25% of the world’s production, and importing over two-thirds of that. Back in mid-90s, when I first started trying to guess the timing of the US collapse, the arrival of the global peak in oil production was scheduled for around the turn of the century. It turned out that the estimate was off by almost a decade, but that is actually fairly accurate as far as such big predictions go. So here it is the high price of oil that is putting the brakes on further debt expansion. As higher oil prices trigger a recession, the economy starts shrinking, and a shrinking economy cannot sustain an ever-expanding level of debt. At some point the ability to finance oil imports will be lost, and that will be the tipping point, after which nothing will ever be the same.

This is not to say that I am a believer in some sort of energy determinism. If the US were to cut its energy consumption by an order of magnitude, it would still be consuming a staggeringly huge amount, but an energy crisis would be averted. But then this country, as we are used to thinking of it, would no longer exist. Oil is what powers this economy. In turn, it is this oil-based economy that makes it possible to maintain and expand an extravagant level of debt. So, a drastic cut in oil consumption would cause a financial collapse (as opposed to the other way around). A few more stages of collapse would follow, which we will discuss next. So, you could see this outlandish appetite for imported oil as a cultural failing, but it is not one that can be undone without causing a great deal of damage. If you like, you can call it “ontological determinism”: it has to be what it is, until it is no more.

I don’t mean to imply that every part of the country will suddenly undergo a spontaneous existence failure, reverting to an uninhabited wilderness. I agree with John-Michael Greer that the myth of the Apocalypse is not the least bit helpful in coming to terms with the situation. The Soviet experience is very helpful here, because it shows us not only that life goes on, but exactly how it goes on. But I am quite certain that no amount of cultural transformation will help us save various key aspects of this culture: car society, suburban living, big box stores, corporate-run government, global empire, or runaway finance.

On the other hand, I am quite convinced that nothing short of a profound cultural transformation will allow any significant number of us to keep roofs over our heads, and food on our tables. I also believe that the sooner we start letting go of our maladaptive cultural baggage, the more of a chance we will stand. A few years ago, my attitude was to just keep watching events unfold, and keep this collapse thing as some sort of macabre hobby. But the course of events is certainly speeding up, and now my feeling is that the worst we can do is pretend that everything will be fine and simply run out the clock on our current living arrangement, with nothing to replace it once it all starts shutting down.

Now, getting back to my own personal progress in working through these questions, in 2005 I wrote an article called “Post-Soviet Lessons for a Post-American Century”. Initially, I wanted to publish it on a web site run by Dale Alan Pfeiffer, but, to my surprise, it ended up on From The Wilderness, a much more popular site run by Michael Ruppert, and, to my further astonishment, Mike even paid me for it.

And ever since then, I’ve been asked the same question, repeatedly: “When? When is the collapse going to occur?” Being a little bit clever, I always decline to give a specific answer, because, you see, as soon as you get one specific prediction wrong, there goes your entire reputation. One reasonable way of thinking about the timing is to say that collapse can occur at different times for different people. You may never quite know that collapse has happened, but you will know that it has happened to you personally, or to your family, or to your town. The big picture may not come together until much later, thanks to the efforts of historians. Individually, we may never know what hit us, and, as a group, we may never agree on any one answer. Look at the collapse of the USSR: some people are still arguing over why exactly it happened.

But sometimes the picture is clearer than we would like. In January of 2008, I published an article on “The Five Stages of Collapse,” in which I defined the five stages, and then bravely stated that we are in the midst of a financial collapse. And ten months later it doesn’t seem that I went too far out on a limb this time. If the US government has to lend banks over 200 billion dollars a day just to keep the whole system from imploding, then the term “crisis” probably doesn’t do justice to the situation. To keep this game going, the US government has to be able to sell the debt it is taking on, and what do you think the chances are that the world at large will be snapping up trillions of dollars of new debt, knowing that it is being used to prop up a shrinking economy? And if the debt can’t be sold, then it has to be monetized, by printing money. And that will trigger hyperinflation. So, let’s not quibble, and let us call what’s happening what it looks like: “financial collapse”.

2.
So here are the five stages as I defined them almost a year ago. The little check-mark next to “financial collapse” is there to remind us that we are not here to quibble or equivocate, because Stage 1 is pretty far along. Stages 2 and 3 – commercial and political collapse, are driven by financial collapse, and will overlap each other. Right now, it is unclear which one is farther along. On the one hand, there are signs that global shipping is grinding to a halt, and that big box retailers are in for a very bad time, with many stores likely to close following a disastrous Christmas season. On the other hand, states are already experiencing massive budget shortfalls, laying off state workers, cutting back on programs, and are starting to beg the federal government for bail-out money.

Even though the various stages of collapse drive each other in a variety of ways, I think that it makes sense to keep them apart conceptually. This is because their effects on our daily life are quite different. Whatever constructive ways we may find of dodging these effects are also going to be different. Lastly, some stages of collapse seem unavoidable, while others may be avoided if we put up enough of a fight.

Financial collapse seems to be particularly painful if you happen to have a lot of money. On the other hand, I run across people all the time, who feel that “Nothing’s happened yet.” These are mostly younger, relatively successful people, who have little or no savings, and still have good paying jobs, or unemployment insurance that hasn’t run out yet. Their daily lives aren’t much affected by the turmoil on the financial markets, and they don’t believe that anything different is happening beyond the usual economic ups and downs.

Commercial collapse is much more obvious, and observing it doesn’t entail opening envelopes and examining columns of figures. It is painful to most people, and life-threatening to some. When store shelves are stripped bare of necessities and remain that way for weeks at a time, panic sets in. In most places, this requires some sort of emergency response, to make sure that people are not deprived of food, shelter, medicine, and that some measure of security and public order is maintained. People who know what’s coming can prepare to sit out the worst of it.

Political collapse is more painful yet, because it is directly life-threatening to many people. The breakdown of public order would be particularly dangerous in the US, because of the large number of social problems that have been swept under the carpet over the years. Americans, more than most other people, need to be defended from each other at all times. I think that I would prefer martial law over complete and utter mayhem and lawlessness, though I admit that both are very poor choices.

Social and cultural collapse seem to have already occurred in many parts of the country to a large extent. What social activity remains seems to be anchored to transitory activities like work, shopping, and sports. Religion is perhaps the largest exception, and many communities are organized around churches. But in places where society and culture remain intact, I believe that social and cultural collapse is avoidable, and that this is where we must really dig in our heels. Also, I think it is very important that we learn to see our surroundings for what they have become. In many places, it feels as if there just isn’t that much left that’s worth trying to save. If all the culture we see is commercial culture, and all the society we see is consumer society, then the best we can do is walk away from it, and look for other people who are ready to do the same.

3.
There is nothing particularly deep or magical about the five stages I chose, except that they seem convenient. They correspond to the commonly distinguished aspects of everyday reality. Each stage of collapse also corresponds to a certain set of beliefs in the status quo, that is about to go by the wayside.

It is always an impressive thing to observe when reality shifts. One moment, a certain idea is seen as preposterous, and the next moment it’s being treated as conventional wisdom. There seems to be a psychological mechanism involved, where nobody wants to be seen as the last fool to finally get the picture. Everybody starts pretending that they’ve thought that way all along, or at least for a little while, for fear of appearing foolish. It is always awkward to ask people what caused them to suddenly change their minds, because with the fear of looking foolish comes a certain loss of dignity.

The most compelling example of lots of minds suddenly going “snap” is, to my mind, the sudden demise of the USSR. It happened with Boris Yeltsin standing atop a tank, and being asked the question: “But what will become of the Soviet Union?” And his answer, pronounced with maximum gravitas was: “Henceforth I shall only refer to it as the FORMER Soviet Union.” And that was that. After that, whoever still believed in the Soviet Union appeared as not just foolish, but actually crazy. For a while, there were a lot of crazy old people parading around with portraits of Lenin and Stalin. Their minds were too old to go “snap”.

Here in the US, we are yet to experience any of the really major, earth-shattering realizations, the ones that look preposterous immediately before and completely obvious immediately after they occur. We have had minor tremors, mostly relating to financial assumptions. Is real estate a good investment. Will private retirement allow you to retire? Will the government bail us all out? All the major realizations are yet to come, or, as my die-hard Yuppie friends keep telling me, “Nothing’s happened yet.”

But by the time something does happen, it will have been too late for us to start planning for it happening. It doesn’t seem all that worthwhile for us to sit around waiting for the happy event of everybody else feeling foolish all at the same time. Arrogant though that may seem, we may be better off accepting their foolishness before they do, and keeping a safe distance ahead of the prevailing opinion.

Because if we do that, we may yet succeed in finding ways to cope. We may learn to dodge financial collapse by learning to live without needing much money. We may create alternative living arrangements and informal production and distribution networks for all the necessities before commercial collapse occurs. We may organize into self-governing communities that can provide for their own security during political collapse. And all of these steps put together may put us in a position to safeguard society and culture.

Or we can just wait until everyone starts agreeing with us, because we wouldn’t want them to look foolish.

4.
The important dynamic, when it comes to financial collapse, is obvious by now. It’s the collapse of credit pyramids, “the whole house of cards” as President Bush put it. The technical term is “deleveraging,” and the response is the bailout. The federal government will be bailing out the banks and the insurance companies, the auto companies, and state governments. Call it the bail-out treadmill: we are borrowing faster and faster just to keep from falling down. The treadmill is actually a good metaphor. Imagine what would happen if you went to a gym, got on a treadmill machine, and just kept punching up the speed, as high as it will go. What happens is you trip and fall, and find yourself flying backwards.

It is instructive to ask the question, Who are we borrowing this bail-out money from? People will tell you that we are borrowing it from “the taxpayer.” But it’s not as if federal tax receipts have automatically shot up by a few trillion over the past couple of months, and so this begs the question, Who is “the taxpayer” going to borrow this money from in the meantime? From other Americans? No, because our savings rate has been abysmally low for quite some time now, and what little we have saved is in housing equity, which is dwindling, and in stocks and bonds, through mutual funds and 401ks and such, which are down by a third or so. The value of these investments is crashing, and if we dumped these investments to raise the cash to fund this new debt, that would just make them crash even faster. In effect, we’d only be moving money from one pocket to another. So, really, the bailouts have to be financed by foreigners. And what if these foreigners decide not to trust us with any more of their savings? Then our only recourse is to “monetize” the debt: to print money.

And so the next question is, how much money would we have to print? The purpose of the bailouts is to provide liquidity to insolvent companies, to avoid deleveraging. To understand what that means, we have to understand that for every actual dollar within the economy, in the sense of it not being borrowed, there are over 13 dollars of borrowed money, which only exists while the debt can be rolled over. If our credit is maxed out while the economy is growing, that’s bad enough, but the US economy is shrinking because of the recent oil shock. A smaller economy cannot carry as much debt, and this is part of the reason why we have deleveraging. Once the process of debt going sour gets started, it is hard to stop, and if deleveraging were to run its course, we would be down over 1300%. To monetize that much debt would require over 1300% inflation. And once that gets started, it becomes very hard to stop.

And, that, believe it or not, is actually the good news. Because most of our debt is denominated in our own currency – the US dollar – the US will not have to declare sovereign default, like Russia was forced to do in the 1990s. Instead, we can inflate our way out of national bankruptcy, by printing a lot of dollars. We will repay our national debt, but we will do so in worthless paper money, bankrupting our international creditors in the process. There is sure to be plenty of pain for everyone, especially everyone who is used to having plenty of money, because their money will no longer make the world go around. Once the US has to start earning foreign currency in order to pay for imports, you can be sure that imports will become quite scarce.

5.
Here are before and after snapshots of the most salient characteristics of financial collapse, as they will affect the vast majority of the population. Here, I am assuming that commercial and political collapse are slower in arriving, and that government is still there to step in with emergency aid of various sorts, and that a market economy of some sort continues to function. It could come down to everyone walking around with their little food stamps debit cards, and the only place they can use them that’s within walking distance is McDonalds, but I am assuming some semi-stable period during which other adjustments can occur before other stages run their course.

The adjustments would have to do with major aspects of the living arrangement, from where we live to how we grow food to how we relate to each other. With money scarce and not particularly potent, other ways of winning the cooperation of others would need to be evolved in a hurry. The financial realm can be seen as a complex system of fences: your bank account is fenced off from my bank account. This arrangement allows you and me to not worry too much about each other, provided each of us has enough to live on. Though this is largely a fiction, we can fancy ourselves to be independent economic players on a level playing field. But once these conceptual fences become irrelevant, because there is nothing behind them, we become each others’ burden, in an immediate sort of way, that would come as a shock to most people. The indignity of such physical interdependence would be psychologically devastating to many people, raising the human toll from financial collapse beyond what you’d expect from a problem that really only exists on paper. This is going to be particularly hard for a nation brought up on the myth of rugged individualism.

6.
Commercial collapse, when it arrives, will again cause much more of a psychological crack-up than you’d expect from a purely organizational problem. The quantities of immediately available goods and services right before and right after the collapse would remain about the same, but because market psychology is so ingrained in the population, no other ways of coping would be considered. Hoarding would become widespread, with looting as the obvious antidote. There would be an instant, huge black market for all sorts of necessities, from shampoo to vials of insulin.

The market mechanism works well in some cases, but it doesn’t work at all when key commodities become scarce. It leads to profiteering, hoarding, looting, and other pernicious effects. There is usually a knee-jerk reaction to regulate the markets, by imposing price controls, or by introducing rationing. I found it quite funny that the recent clamoring for re-regulating the financial markets was greeted with cries of “Socialists!” Failing at capitalism doesn’t make you a socialist, any more than getting a divorce automatically make you gay.

If by the time commercial collapse is upon us, there is still enough of the political system left intact to implement rationing and price controls and emergency distribution schemes, then we should count these among our blessings. Such heavy-handed governance is certainly not a crowd-pleaser during times of plenty, when it’s also unnecessary, but it can be quite a life-saver during times of scarcity. The Soviet food distribution system, which was plagued with chronic underperformance during normal times, proved to be paradoxically resilient during collapse, allowing people to survive the transition.

7.
If prior to commercial collapse the challenge is finding enough money to afford the necessities, afterward the challenge is getting people to accept money as payment for these same necessities. Many of the would-be sellers will prefer to be paid in something more valuable than mere cash. Customer service comes to mean that customers must provide a service. Given that most people won’t have much to offer, other than their now worthless money, should they still have any, most purveyors of goods and services decide to take a holiday.

With the disappearance of the free and open market, even the items that still are available for sale come to be offered in a way that is neither free nor open, but only at certain times and to certain people. Whatever wealth still exists is hidden, because flaunting it or exposing it just increases the security risk, and the amount of effort required to guard it.

In an economy where the vast majority of manufactured items is imported, and designed with planned obsolescence in mind, it will be difficult to keep things running as imports dry up, especially imports of spare parts for foreign-made machinery. The pool of available equipment will shrink over time, as more and more pieces of equipment become used as “organ donors.” In an effort to keep things running, entire cottage industries devoted to refurbishing old stuff might suddenly come together.

8.
It is sometimes hard to discern political collapse, because politicians tend to be quite good at maintaining the pretense of power and authority even as it dwindles. But there are some telltale signs of political collapse. One is when politicians start moonlighting because their day job is no longer sufficiently gainful. Another is when regional politicians start to openly defy orders from the political center. Russia experienced plenty of each of these symptoms.

One thing that makes political collapse particularly hard to spot is that the worse things get, the more noise the politicians emit. The substance to noise ratio in political discourse is pretty low even in good times, making it hard to spot the transition when it actually drops to zero. The variable that’s easier to monitor is the level of political embarrassment. For instance, when Mr. Nazdratenko, the governor of the far-east Russian region of Primorye, stole large amounts of coal, made strides in the direction of establishing an independent foreign policy toward China, and yet Moscow could do nothing to reign him in, you could be sure that Russia’s political system was pretty much defunct.

Another telltale sign of political collapse is actual disintegration, where regions declare independence. In Russia, that was the case with Chechnya, and it led to a prolonged bloody conflict. Here, we might have a “Reconquista” where former Mexican territories become ever more Mexican, the South might rise again. New England, California, and the Pacific Northwest might decide to go their separate ways. Once the interstate highway system is no longer viable and the remaining domestic airlines are extinct, there is not much to keep the two coasts together. What once united the country was the construction of the continental railroad, but railroads have been too neglected to hold it together now. A country consisting of two halves tied together via Panama Canal is de facto at least two countries.

Yet another thing to watch for is foreign incursions into domestic politics. When foreign political consultants start stage-managing elections, as happened with Yeltsin’s reelection campaign, you can be sure that the country is no longer in charge of its own political system. In the US, there is a gradual surrender of sovereignty, as sovereign wealth funds buy up more and more US assets. That sort of thing used to be considered akin to an act of war, but these are desperate times, and they are allowed to do so without so much as a nasty comment. Eventually, they may start making political demands, to extract the most value out of their investments. For instance, they could start vetting candidates for public office, to make sure that we remain friendly to their interests.

Lastly, the power vacuum created by the collapse of legitimate authority tends to be more or less automatically filled by criminal syndicates. These often try to commandeer the political establishment by getting their heads elected or appointed to political offices. Examples include Russian oligarchs, such as Boris Berezovsky, who got himself elected to Duma, the Russian parliament, and Mikhail Khodorkovsky, who thought he could use his oil wealth to buy his way into the political establishment. Luckily for Russia, Berezovsky is in exile in England, and Khodorkovsky is in jail.

9.
A great many people in the US insist that they do not need government help, and that they would do just fine if only the government would leave them alone. But this is really just a pose; there is a great deal that that government does to make their lives possible. In the United States, the federal government keeps many people alive through programs such as Medicaid, Social Security, and food stamps. Local governments provide for trash removal and water and sewer line maintenance, road and bridge repair, and so on. Police departments try to defend people from each other.

When all of that starts to unravel, it is likely to do so from the bottom, not from the top. Local officials are more accessible than remote Washington bureaucrats, and so they will be the first to be overwhelmed by the anger and confusion of their constituents, while Washington remains unresponsive. One likely exception may have to do with the use of federal troops. It seems almost a given that troops repatriated from the more than 1000 foreign military bases will see action right here at home. They will be reassigned to domestic peacekeeping duties.

10.
Aside from the big government programs, there is little available in the US to help those in need. Again, Americans make a big show of their philanthropy, but, compared to other developed countries, they are in fact quite stingy when it comes to helping those in need. There is even a streak of political sadism, which, for example, shows up in people’s attitudes toward welfare recipients. This sadism can be seen in the so-called welfare reform, which has forced single mothers to work jobs that barely cover the cost of daycare, which is often substandard.

Aside from the government, there are charities, many of which are church-based, and so they have the ulterior motive of recruiting people to their cause. But even when a charity does not make any specific demands, its real purpose is to reinforce the superiority of those who are charitable, at the expense of those who are the recipients. There is a flow of forced gratitude from the beneficiary to the benefactor. The greater the need, the more humiliating is the transaction to the beneficiary, and the more satisfying it is to the benefactor. There is no motivation for the benefactor to provide more charity in response to greater need, except in special circumstances, such as immediately following a natural disaster. Where the need is large, constant, and growing, we should expect charities to matter very little when it comes to satisfying it.

Since neither government largesse nor charity is likely to provide for those who cannot provide for themselves, we should look for other options. One promising direction is a revival of mutual help societies, which take membership contributions and then use them to help those in need. At least in theory, such organizations are vastly better than either government aid or charities. Those who are helped by them do not have to surrender their dignity, and can survive difficult times without being stigmatized.

To make it intact through times of great need, the only reasonable approach, it seems to me, is to form communities that are strong and cohesive enough to provide for the well-being of all of their members, that are large enough to be resourceful, yet small enough so that people can relate to each other directly, and to take direct responsibility for each other’s well-being.

11.
If this effort fails, then the outlook becomes dire indeed. I would like to emphasize, once again, that we must do all we can to avoid this stage of collapse. We can allow the financial system, and the commercial sector, and most of the government institutions to collapse, but not this.

What makes this particularly challenging is that the existence of finance and credit, of consumer society, and of government-imposed law and order has allowed society, in the sense of direct, mutual help and of freely accepting responsibility for each others’ welfare, to atrophy. This process of social decay may be less advanced in groups that have survived recent adversity: immigrant and minority groups, or people who served together in the armed forces. The instincts that underlie this behavior are strong, and they are what helped us survive as a species, but they need to be reactivated in time to create groups that are cohesive enough to be viable.

12.
Culture can mean a great many things to people, but what I mean here is a specific very important element of culture: how people relate to each other face to face. Take honesty, for instance: do people demand it of themselves and others, or do they feel that it is acceptable to lie to get what you want? Do they take pride in how much they have or in how much they can give? I took this list of virtues from Colin Turnbull, who wrote a book about a tribe in which most of these virtues were almost entirely missing. Turnbull’s point was that these personal virtues are also all but destroyed in Western society, but that for the time being their absence is being masked by the impersonal institutions of finance, commerce, and government.

I believe that Turnbull has a point. Ours is a cold world, in which the citizens are theoretically expected to fend for themselves, but in reality can only survive thanks to the impersonal services of finance, commerce, and government. It only allows us to practice these warm virtues among family and friends. But that is a start, and from there we can expand this circle of warmth to encompass more and more of the people who matter to us and we to them.

13.
In his amazing book about the legacy of European colonialism, Exterminate all the Brutes, Sven Lindqvist makes the stunning observation that violence renders one unrecognizable. The aggressor, whether active or passive, becomes a stranger.

The violence does not have to be physical. One subtle type of mental violence that abounds in our world is the act of refusing to acknowledge someone’s existence. We may believe that it makes us safer to walk past people without making eye contact. That is certainly true if our look is blank and indifferent, and it is then better to avert one’s gaze than to look, and in effect to say: “I do not recognize you.” That definitely does not make you any safer. But if your look says “I see you, you are OK,” or even “I recognize you,” then the effect is quite the opposite. Dogs understand this principle perfectly well, and so should people.

14.
When I was doing a radio tour to promote my book, a lot of the AM radio motor-mouths who interviewed me would sum up the interview with something like “So this is all doom and gloom, isn’t it.” And then I would have maybe 15 seconds for a rebuttal. So here is my standard 15 second rebuttal: “No, my message is actually quite hopeful. I want to let people know that they can find ways to lead happy, fulfilling lives even as this doomed system crumbles all around them.” Here, I can give you a longer answer.

I believe that the financial pyramid scheme and globalized consumerism are done. But I think that having no government at all is not an option. Forget entitlements, forget military bases on foreign soil, forget the three-ring circus that passes for representative democracy here, but we will still need agencies to print passports, to control the nuclear stockpile, as well as many other mundane but essential services that only a central government can provide. For most other needs, local self-government may be the best we can do, but that may not be bad at all.

Commercial collapse need not be final. It is quite possible that a new economy will arise spontaneously, one without all the frills and the waste, but able to provide for most of the basic needs. In the places that are socially and culturally intact, this is almost inevitable, as people take charge and start doing what’s necessary without waiting for official sanction.

As far as social and cultural collapse, as I already mentioned, to some extent they have already happened, but this is being masked, for the time being, by the availability of finance, commerce, and government. But they can be undone, not everywhere, of course, but in quite a few places, because the instincts are there, and a dire common predicament can be the catalyst that changes society, bringing it closer to the human norm.

15.
Knowing what to expect can provide us with peace of mind, even in the midst of collapse. Wallowing in nostalgia over the good old days, or denying that sweeping changes are before us — these responses are definitely unhealthy.

If we know what’s coming, we can start ignoring the things that we will not be able to rely on. If we do enough of this, we may find ourselves in a different world, quite possibly a better one, rather quickly. Here is a personal example. Some years ago, I decided to give up the car, finding it quite impractical, and started bicycling instead. It wasn’t that easy at first, but once I got used to it, a strange thing happened to my perception: I started seeing cars quite differently. On the way to work in the morning, I would ride along a stretch of highway, which was always packed with cars. When you are driver, you see it as normal, because you are part of this herd of mechanized insects. But what I saw was sheet metal boxes with people imprisoned inside them, strapped down to a chair inside a tiny padded cell, and most of these poor crazies were just pictures of misery: an angry, desperate, lonely mob, condemned to move about in circles. And then I would happily pedal away, through a park and around a pond, and leave that horrible, dying world behind.

And so it is with a great many things. We can wait until the lifestyle that is killing the planet and is making us crazy and sick is no longer physically possible, or we can opt out of it ahead of time. And what we replace it with can be difficult at first, but quite a lot better for us in the end.

16.
So let us summarize our findings. Financial collapse is already quite far along, and is guaranteed to run its course. Bailouts can make insolvent institutions look solvent for a time by providing liquidity, but one thing they cannot provide is solvency. For instance, no matter how much we bail out the auto companies, making any more cars will still be a bad idea. Similarly, no matter how much money we give to banks, their loan portfolios, loaded down with houses built in places that are inaccessible except by car, will still end up being worthless. By continuously nationalizing bad debt, the country will make itself into a bad credit risk, and foreign lenders will walk away. Hyperinflation and loss of imports will follow.

17.
Commercial collapse is likewise guaranteed to happen. One key import is oil, and here the loss of imports will cause much of the economy to shut down, because in this country nothing moves without oil. But it should be possible to come up with new, far less energy-intensive ways to provide for the basic needs.

18.
Political collapse is guaranteed as well. As tax receipts dwindle, municipalities and states will no longer be able to meet the minimal maintenance requirements for existing infrastructure: roads, bridges, water and sewer mains, and so forth. Municipal services, including police, fire departments, snow removal and garbage collection, will also be curtailed or eliminated. The better-organized communities may be able to find ways to compensate, but many communities will become impassable and uninhabitable, generating a flood of internal refugees.

Currently, the political class couldn’t be farther from understanding what is about to happen. I listened in on one of the recent presidential debates (I don’t have a television set, but I caught a chunk of it on NPR). It struck me that the two candidates spent most of the time arguing over ways of spending money that they don’t have. For me, listening to them was a waste of time that I didn’t have. I suspect that my book, would sell better if McCain got elected; nevertheless, I choose to remain selflessly apolitical. National politics is a distraction and a waste of time.

Actually, I should be gratified. A while ago I proposed a whimsical Collapse Party. The Collapse Party platform featured planks such as the freeing of prisoners to whittle down the prison population before a general amnesty becomes necessary due to lack of funds, a jubilee – forgiveness of all debts – to wipe the slate clean of all these bad loans, and a few others. Elsewhere, I proposed that it is a good idea to stop making new cars – just run down the ones we already have, and we’ll run out of cars just as we run out of gas. I am happy to report that this has been banner year for the Collapse Party. Without fielding a single candidate, we managed to push through much of our agenda: many states are releasing prisoners due to the fiscal crisis, the federal government is now involved in avoiding foreclosures, a huge credit card debt write-off is in the works (not quite a jubilee, but still…) and now automakers are ready to consolidate or declare bankruptcy. Next year, perhaps we will repatriate troops and shut down overseas military bases, also in line with the Collapse Party platform.

19.
Continuing with our recap, I see social collapse as avoidable, but not in all places. In many places, the task is to reconstitute society before the first three stages run their course, and it may already be too late. But this is where we need to make a stand, if only to be remembered for something more than the sum total of our mistakes.

20.
Lastly, cultural collapse is something that’s almost too horrible to contemplate, except that in some places it seems to have already happened, and is being masked by the various institutions that still exist, for the time being. But I believe that a lot of people will come around and remember their humanity, the better parts of their natures, when dire circumstances force them to rise to the occasion.

Also, there are some intact pockets of culture here and there that can be used as a sort of cultural seed stock. These are communities and groups that have seen some adversity in recent times, and have some social cohesion left over from the experience. They may also be those who made certain conscious decisions, to simplify their living arrangements in order to lead saner, more fulfilling lives. We must do all we can to avert this final stage of collapse, because what is at stake is nothing less than our humanity.

21.
I hope that, if you have been following along, by this point this slide is self-explanatory. Collapse is not one monolithic thing. Each kind of collapse requires a response, be it jumping clear ahead of time, sitting it out, or opposing it with all you got. At this point, if anyone in this room got up and tried to tell us what to do to avoid financial collapse, we would probably find that quite funny. On the other hand, if we stand by and let social and cultural collapse unfold, then what’s the point of any of this?

That’s all. Thank you for listening.

Editorial Notes

This article is a talk that was originally given by Dmitry Orlov at the Community Solutions Conference in Michigan in November 2008.

Thanks to SO and KS for the formatting. This was an especially difficult job.

-BA

Secretive Corporate-Legislative Group ALEC Holds Annual Meeting To Rewrite State Laws Favoring Corporations

Oldspeak: Ever heard of ALEC (American Legislative Exchange Council)? Probably not. This clandestine corpocratic cabal of overwhelmingly conservative Republicans has brought you such legislative gems as SB 1070 (Arizona’s “Papers Please?” Law) mandatory minimums for non-violent drug offenders, “three strikes” laws, Prison Industries Act (Prison Labor), drafed bills to change tax laws, attack worker rights, roll back environmental regulations, privatize education, deregulate major industries, and pass voter ID laws. And the bills ALEC task forces usually favor the corporations and industries they’re meant to regulate and affect. “It is in fact the case that politicians and corporations are voting as equals on “model legislation” through ALEC task forces, and corporations have the right to veto, through this process, legislation that even a majority or—a majority of politicians within those meetings would approve. Those meetings cover every area of law, including the rights of Americans killed or injured by corporations, as well as healthcare, pensions—you name it, basically it’s covered.” -Lisa Graves ”More than 98% of ALEC’s revenues come  corporations, corporate trade groups, and corporate foundations. Each corporate member pays an annual fee of between $7,000 and $25,000 a year, and if a corporation participates in any of the nine task forces, additional fees apply, from $2,500 to $10,000 each year. ALEC also receives direct grants from corporations, such as $1.4 million from ExxonMobil from 1998-2009. It has also received grants from some of the biggest foundations funded by corporate CEOs in the country, such as: the Koch family Charles G. Koch Foundation, the Koch-managed Claude R. Lambe Foundation, the Scaife familyAllegheny Foundation, the Coors family Castle Rock Foundation, to name a few.” -Center for Media and Democracy So basically, as was grotesquely demonstrated by the passage of the wildly unpopular “debt deal” by the U.S. Congress, corporations’ votes count more than the elected officials who supposedly represent you, and introduce them as legislation to be made law. Some the results of this legislative alchemy? An explosion in the prison population and by extension a vastly expanded prison-industrial complex (U.S. accounts for 4% of world population and 25% of world prison population), an explosion in prison labor (to the detriment of unionized, and public sector workers) which constitutes unfair competition with corporations and small businesses who don’t use slave -er… prison labor. deregulation, reduced safety, reduced taxes on the richest americans & corporations, failed school privatization policies…. etc etc etc. More concrete evidence that the U.S. Government, has been captured by the Corprotocracy. It is obvious to any one paying attention that your government no longer works for we the people. Oligarchy In Action.”

Related Links:

The Hidden History of ALEC and Prison Labor

 

New Exposé Tracks ALEC-Private Prison Industry Effort to Replace Unionized Workers with Prison Labor

Alec Exposed

 

Center for Media and Democracy 

By Amy Goodman @ Democracy Now:

AMY GOODMAN: Hundreds of state legislators from all 50 states have gathered in New Orleans, Louisiana, for the 38th annual meeting of the American Legislative Exchange Council, also known as ALEC. The meeting’s top donor? BP, followed by R.J. Reynolds Tobacco and Takeda Pharmaceutical Company. Critics say the Washington-based group has played a key role in helping corporations secretly draft model pro-business legislation that’s been used by state lawmakers across the country.

Unlike many other organizations, ALEC’s membership includes both state lawmakers and corporate executives. At its meetings, the corporations and politicians gather behind closed doors to discuss and vote on model legislation. Before the bills are publicly introduced in state legislatures, they’re cleansed of any reference to who actually wrote them. However, the chair of ALEC, Noble Ellington, insisted in an interview with NPR’s Terry Gross that he works for the tax-paying public. Ellington is a Republican member of the Louisiana State Legislature.

REP. NOBLE ELLINGTON: We represent the public, and we are the ones who decide. So the tax-paying public is represented there at the table, because I’m there.

TERRY GROSS: I understand that, but you’re there at the table with corporations. But at the table—

REP. NOBLE ELLINGTON: Can I interrupt you again?

TERRY GROSS: Yes.

REP. NOBLE ELLINGTON: It’s not just corporations. I’m there, and members of ALEC is the Americans for Tax Reform, the National Taxpayers Union, National Federation of Independent Businesses. Those are people that we represent, as well, and those are people who are members.

TERRY GROSS: But those are—those are all pro-business, anti-tax groups. People not represented at the table include workers, union members, teachers, students—

REP. NOBLE ELLINGTON: No, ma’am. No, ma’am. You are—

TERRY GROSS: —patients, patients who can’t pay medical bills.

REP. NOBLE ELLINGTON: You are completely wrong.

AMY GOODMAN: That was, an exchange between NPR’s Terry Gross and ALEC chairman Noble Ellington.

In recent months, ALEC has come under increasing scrutiny for its role in drafting bills to attack worker rights, roll back environmental regulations, privatize education, deregulate major industries, and pass voter ID laws. Nonetheless, this year’s annual ALEC meeting boasts the largest attendance in five years, with nearly 2,000 people in attendance. The conference features speakers like, oh, Louisiana Governor Bobby Jindal, former West Virginia Governor Bob Wise, Wall Street Journal contributor Steve Moore, and the president of the American Enterprise Institute, Arthur Brooks.

Now, a new exposé in The Nation magazine called “The Hidden History of ALEC and Prison Labor” details ALEC’s instrumental role in the explosion of the U.S. prison population in the past few decades. According to the article, ALEC pioneered some of the toughest sentencing laws on the books today and paved the way for states and corporations to replace unionized workers with prison labor.

We’re joined now by the one of the reporters who wrote the article, Mike Elk, contributing editor to The Nation magazine. We’re also joined by Lisa Graves. She’s in New Orleans right now, where the ALEC conference is taking place. She’s executive director of the Center for Media and Democracy. Last month, the Center for Media and Democracy released 800 model bills approved by companies and lawmakers at recent ALEC meetings. We invited a member of ALEC to join us, but they denied our request.

Mike Elk, Lisa Graves, welcome to Democracy Now! Lisa, talk about what’s happening right now in New Orleans. Are you getting into this conference? What are you seeing? What are the seminars, these sessions about?

LISA GRAVES: Well, the Center for Media and Democracy was denied access to the convention with one of our cub reporters, and he was required to leave the convention hotel, the Marriott. But we have received reports, from behind closed doors, from those meetings, at which corporations and politicians are voting on model legislation. And one of the reports we received yesterday from insiders is that corporations vetoed model legislation that politicians had voted for. And so, it is in fact the case that politicians and corporations are voting as equals on model legislation through ALEC task forces, and corporations have the right to veto, through this process, legislation that even a majority or—a majority of politicians within those meetings would approve.

Those meetings cover every area of law, including tax, environment, workers’ rights, the rights of Americans killed or injured by corporations, as well as healthcare, pensions—you name it, basically it’s covered. And we’ve even seen coverage from inside about sessions with ALEC, in which they had one session called “Warming Up to Climate Change: How Increased CO2 Can Benefit You.”

AMY GOODMAN: I want to go back to Terry Gross of NPR speaking with the national chair of ALEC, Noble Ellington, the Republican member of the Louisiana State Legislature. Terry Gross asked Ellington why ALEC gives corporations such a big say in drafting legislation. This is an excerpt of their exchange.

TERRY GROSS: Why give corporations such a big say in drafting legislation?

REP. NOBLE ELLINGTON: Well, partly because they are one of the ones who will be affected by it. And you say “a big say,” but as I expressed to you earlier, and I think it needs to be made perfectly clear, that they have—they do not have the final say about model legislation. It is done with work with task forces, which is both public and private sector working together. But before it ever becomes model legislation or ALEC policy, it has to go through the public sector board, not the private sector. So only the public sector had the final say as to whether or not something becomes model legislation.

AMY GOODMAN: That’s the ALEC chair, Noble Ellington. Lisa Graves, your response?

LISA GRAVES: Well, it’s interesting, because what we saw and what we heard from inside yesterday is that, quite clearly, corporations can veto things before the public board that Noble Ellington sits on have a chance to approve it. So, in essence, if the corporations disagree on proposed legislation at the task force level, it never makes it to the board that Senator Ellington sits on.

The fact is that corporations exert extraordinary influence and control over this process. They can veto legislation through the task forces. They are the bankrollers of ALEC. Over 98 percent of the money that funds ALEC’s operations come from everything except for legislative dues, which are 50 bucks a year. Some legislators are so cheap, they don’t even pay it themselves; they have the taxpayer pay it for them. Meanwhile, corporations can pay $7,500 or $25,000 a year for membership, and then some corporations, like BP, a year after the disaster in the Gulf, is now the headline corporation underwriting this convention. They’re the top corporation listed in the President’s Circle for ALEC’s convention this year.

AMY GOODMAN: Taking place, of course, there in New Orleans. What has the debt deal negotiations and this whole crisis that has happened in Washington meant for this conference and for ALEC? What are they saying about it?

LISA GRAVES: Well, they haven’t—they haven’t mentioned a lot about it directly, at least in the sessions that we’ve heard reports from. However, we do know that Governor Jindal spoke sort of extensively about the power of being stubborn, the importance of being stubborn and the power of that, which I think was a direct reference to the debt negotiations. The fact is that ALEC alums include Congressman John Boehner, who’s the speaker of the House, as well as Congressman Eric Cantor, who’s the Republican leader of the House. ALEC legislation parallels legislation that has been introduced in the U.S. House of Representatives to cap spending by government, to reduce taxes on the richest of Americans and the richest corporations, and so that agenda is moving both through Congress and through the states, and it’s an agenda whose ideas are made concrete through model legislation that ALEC produces every year. These politicians who sit on the board with Senator Ellington and others, they have approved over 850 pieces of legislation or resolutions, that we’ve made available to the public and have analyzed, and that the public is joining us, along with reporters, in analyzing. And so, we know what this agenda looks like. It looks like the same sort of deal that was pushed through in Congress this week.

AMY GOODMAN: Lisa Graves, the significance of holding this conference in post-Katrina New Orleans? I mean, you’ve talked about BP sponsoring it—of course, the huge BP oil spill. But also, all the teachers fired in New Orleans. It’s known as a Petri dish for policy in this country, and not as many people may be aware—as aware of that.

LISA GRAVES: Well, that’s right. Well, on the one hand, we certainly are happy to see money coming into the New Orleans—the New Orleans economy, even from a convention like ALEC’s, where these corporations and politicians are engaged in this sort of unprecedented joint voting.

The fact is that we had a press conference earlier this week with local school board representatives, including a Republican on the school board, as well as local teachers, who have talked about the failure of policies that basically privatize public education in New Orleans to push money out of the public school system into not-well-regulated charter schools, charter schools that have had severe problems, and how those policies have failed at the ground-floor level here in New Orleans. People who were part of that conference said they wondered where the push was coming for these proposals to just massively change the school system. It turns out these proposals are echoed in ALEClegislation that’s being pushed across the country. It’s a one-size-fits-all, McBill sort of factory within ALEC, and it serves the interests of ALEC corporations, including the ALECEducation Task Force, which is co-chaired by an online school company, a for-profit company.

AMY GOODMAN: Is there anything else you think is critical to understand about this organization that not that many people know about by name, ALEC, but may know about by laws that are passed in their states, with them not knowing where they are coming from?

LISA GRAVES: Well, we think that fellow reporters and citizens can make a lot of use of our website, alecexposed.org. We have lists of politicians. We’ve added over a thousand politicians over the past few weeks since the site was launched. We have profiles and links to profiles on some of the corporations that are the leading players withinALEC, including Koch Industries. And we also are discovering new corporations every day. For example, today, Dick Armey, who is the leader of FreedomWorks, who basically is one of the leaders of the Tea Party effort, is speaking at a luncheon, and that is sponsored by Visa. I say to Visa: “Not priceless.” The fact is that what we’re seeing here is an extraordinary influence of corporations on our policy. And we do know—and I would say, with respect to your next segment, we understand from other reporters that ALEC is denying that the Corrections Corporation of America is a member or leader of ALEC, but we have proof that Corrections Corporation of America, which has been involved in pushing this prison privatization agenda, was a member of ALEC as of at least last month.

AMY GOODMAN: Well, I want to thank you very much for being with us. “The Hidden History of ALEC and Prison Labor” is our next segment. Lisa Graves, of the Center for Media and Democracy, in New Orleans.